When the Marginal Propensity to Consume (MPC) Increases

question 152

Multiple Choice

When the marginal propensity to consume (MPC) increases

• A) the multiplier remains unchanged.
• B) the multiplier increases.
• C) the multiplier decreases.
• D) the average propensity to save remains unchanged.

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Definitions:

Mundane Realism

The degree to which an experiment is superficially similar to everyday situations, enhancing its external validity.

Literary Digest

Literary Digest was a general interest magazine in the United States that published from 1890 until 1938, known for its flawed public opinion poll about the 1936 presidential election.

Non-Random Sample

A sample that is not selected through a random method, potentially leading to biased results due to the method of selection.

Internal Validity

The extent to which a study can demonstrate a causal relationship between variables, minimizing the impact of confounding variables.