Which of the Following Is Evidence That Consumption Depends on Total

question 7

Multiple Choice

Which of the following is evidence that consumption depends on total wealth,and not just on current income?

• A)people save very little for their retirement.
• B)the pre-announced phased-in tax cuts of 1981-83 caused little change in consumption in 1981.
• C)a drop in consumer confidence,with unchanged current income,often causes total consumption spending to fall.
• D)all of the above
• E)none of the above

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Definitions:

Federal Budget Deficit

The shortfall when a government's expenditures exceed its revenues within a specified fiscal period.

National Debt

The aggregate financial borrowing of a country's government, acquired through multiple methods.

Public Debt

The total amount of money that a government owes to creditors, often as a result of deficit spending.

Federal Government Deficits

Occurs when a government's expenditures exceed its revenues during a specific fiscal period, leading to borrowing or debt accumulation.