If the Average Propensity to Consume Is Initially 0

question 67

Multiple Choice

If the average propensity to consume is initially 0.8, the marginal propensity to consume is 0.75, and real disposable income increases by $1000, the value of saving

• A) increases by $200.
• B) increases by $250.
• C) decreases by $250.
• D) decreases by $200.

---

Definitions:

Temperament

The enduring aspect of an individual's personality that influences how they interact with the world.

Environment Demands

The requirements or pressures put forth by one's surroundings, necessitating adaptation or response.

Maltreatment

Refers to improper or cruel treatment, often discussed in contexts such as child abuse, elder abuse, or animal cruelty.

Stranger Anxiety

A fear or distress that infants commonly exhibit around strangers, typically emerging around 6 months of age and peaking around the first year.