Identify the Correct Statement with Respect to Consumption and Saving

question 89

Multiple Choice

Identify the correct statement with respect to consumption and saving function.

• A)Both the consumption function and the saving function have negative slopes.
• B)As disposable income declines, consumption and saving increase.
• C)The consumption function has a negative slope while the saving function has a positive slope.
• D)As disposable income rises, consumption and saving increase.
• E)The consumption function has a positive slope while the saving function has a negative slope.

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Definitions:

Average Variable Costs

The total variable costs (costs that change with the level of output) divided by the number of units produced, indicating the average cost of producing each unit.

Industry Giants

The largest and most influential companies within a sector, known for their market domination, innovation, and financial capabilities.

Lower Prices

Lower prices indicate a decrease in the cost that consumers are asked to pay for goods or services, often aimed at boosting sales or competitiveness.

Marketing Mix

The combination of factors that can be controlled by a company to influence consumers to purchase its products, typically includes product, price, place, and promotion.