In a Linear Equation Relating Income and Consumption, You Know

question 153

Multiple Choice

In a linear equation relating income and consumption, you know that the intercept is $1,000 and the slope of the line is 4. If income is $20,000, then consumption is

• A) $8,000.
• B) $9,000.
• C) $10,000.
• D) $11,000.

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Definitions:

Contingent Liability

A potential financial obligation that may arise in the future depending on the outcome of a specific event.

Remote

Pertaining to work or activities done away from a central office or location, often implying the use of technology to facilitate communication and task completion.

Estimable

The ability to be estimated or quantified, often used in contexts where financial figures or outcomes need to be projected or approximated.

Quick Ratio

A measure of liquidity that calculates a company's ability to cover its short-term liabilities with its most liquid assets.