If Income Is $50,000, Consumption Is $47,500, and Saving Is

question 75

Multiple Choice

If income is $50,000, consumption is $47,500, and saving is $2,500, then the average propensity to consume is:

• A) 0.95.
• B) 0.50.
• C) 0.05.
• D) There is not enough information to answer this question.

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Definitions:

Genetic Trait

An attribute or characteristic that is passed from parents to offspring through genes.

Operant Conditioning

A method of learning that employs rewards and punishments for behavior, emphasizing the effect of consequences on behavior.

Classical Conditioning

A teaching approach where an association is made between a stimulus found in the environment and one that happens inherently.

Nature

The phenomena of the physical world collectively, including plants, animals, the landscape, and other features and products of the earth.