Suppose the Consumption Function Equaled C = 2

question 124

Multiple Choice

Suppose the consumption function equaled C = 2 + .7(Y - T) .If taxes increased by $10 billion,the expenditure line would shift

• A)down by $7 billion.
• B)up by $10 billion.
• C)up by $7 billion.
• D)down by $10 billion.
• E)down by $3 billion.

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Definitions:

Cognitive Psychology

The branch of psychology that studies mental processes including how people think, perceive, remember, and learn.

Social Psychology

The scientific study of how individuals think, feel, and behave in the context of social interactions and how they are influenced by the actual or implied presence of others.

Scientific Method

A systematic and logical approach to discovering how things in the universe work, involving observation, hypothesis formulation, experimentation, and conclusion.

Margin of Error

A statistic expressing the amount of random sampling error in a survey's results, indicating how much the survey results may deviate from the actual population values.