The Sum of the Marginal Propensity to Consume and the Marginal

question 185

Multiple Choice

The sum of the marginal propensity to consume and the marginal propensity to save is always equal to

• A)zero.
• B)0.5.
• C)1.
• D)100.

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Definitions:

Interest Revenue

Income earned on investments, such as loans and securities, over a period.

Operating Income

Revenue from business operations after deducting operating expenses, but before interest and taxes.

Cost Method

An accounting method used to value certain investments at their original purchase cost, without adjusting for market fluctuations.

Recognizes Dividends

The process by which a company records the payment of dividends to its shareholders in its financial statements.