Following Is Consumption Schedules for Three Private Closed Economies

question 98

Multiple Choice

Following is consumption schedules for three private closed economies.DI signifies disposable income and C represents consumption expenditures.All figures are in billions of dollars.

-Refer to the above data.At an income level of $40 billion,the average propensity to consume:

• A) is highest in economy (1).
• B) is highest in economy (2).
• C) is highest in economy (3).
• D) cannot be determined from the data given.

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Definitions:

Forecasting

The process of making predictions of the future based on past and present data and analysis of trends.

Business Strategy

A plan of action designed by organizations to achieve defined goals, compete in the market, and improve financial and market performance.

FA/Sales Ratio

A financial ratio that compares a company's fixed assets to its sales revenue, indicating how well assets are being used to generate sales.

Fixed Assets

Long-term tangible assets used in the operation of a business and not expected to be converted to cash in the short term.