If the MPC Equals 0.75, Then

question 377

Multiple Choice

If the MPC equals 0.75, then

• A) for every $100 increase in consumption, real Gross Domestic Product (GDP) increases by $75.
• B) consumption is always more than real Gross Domestic Product (GDP).
• C) for every $100 increase in real Gross Domestic Product (GDP), saving increases by $75.
• D) for every $100 increase in real Gross Domestic Product (GDP), saving increases by $25.

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Definitions:

Disclosed Basis of Accounting

The accounting principles and policies a company openly reports in its financial statements.

GAAP

Generally Accepted Accounting Principles, a common set of accounting principles, standards, and procedures that companies must follow when they compile their financial statements in the U.S.

Fair Value

The price at which an asset would be exchanged between knowledgeable, willing parties in an arm's length transaction.

Full IFRS

The complete set of International Financial Reporting Standards that are globally accepted guidelines for preparing financial statements.