13 In this consumption function C= C0 + C1*Yd equation; C1*Yd Known as Select one: a. Disposable income b. Autonomous consumption c. Marginal propensity to consume d. Induced consumption
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- Quèstion 20 $60 A $40 + $20 + $50 100 150 200 Disposable Income(Y) -20 Refer to the diagram. The average propensity to consume: O A. cannot be detemined from the information given. O B. is equal to the average propensity to save. OC, is greater than 1 at all levels of disposable income below $100. O D. is greater than 1 at all levels of disposable income above $100. Saving (S)Quèstion 27 $60 $40+ $20 十 $50 100 150 200 Disposable Income(Y) -20 Refer to the diagram. The average propensity to consume: O A. is equal to the average propensity to save. O B. cannot be determined from the information given. OC is greater than 1 at all levels of disposable income above $100. O D. is greater than 1 at all levels of disposable income below $100. Saving (S)Consumption C₂ B Refer to Figure 10-3. Marginal propensity to consume is equal to a. CoF divided by AF. O b. CoA divided by AF. OC. AF divided by CoA. Od. AF divided by CoF. Figure 10-3 Yds [VO₂ Disposable Income Yd.
- 500 1,000 Aggregate output, Y (billions of dollars) Figure 8.1 Refer to Figure 8.1. An increase in the MPC Select one: Oa shifts the saving function downward. Ob.makes the caving function fatte Oashifts the consumption function upard. .2.makes the consumption function fatter) billions of dollars)5. Explain the concept of autonomous consumption.hich theory of consumption best explains the consumption behavior of consumers of our economy? Question No: 02 [Marks: 10] If the State Bank started printing large quantities of Pakistani Rupees (Rs), what would happen to the number of Pakistani Rupees a dollar could buy? Why? Question No: 03 [Marks: 10] Deseribe the difference batuuean foreian diract investmet and foraion nortfolie invastment Who is mora likelu to
- Assume in a simple economy that thc level of saving is -500 when aggregate ourput equals zero and that the margina! propensity to save is 0.2. Derive the saving function and the consumption function, and draw a graph showing these func- tions. At what level of aggregate ouiput does the consumption curve cruss the 45° line? Explain your answer and show this un the graph.9- What could be the reason of shifting of consumption line upward from 1 to 3 as it is plotted in the Graph? C'= C+c Y. C,(Consumption) C= Co + c Yd (initial stage) 2 3 Cl"= C + c Y4 Sa Co Yd (Income) a) An increase in marginal propensity to consume b) An increase in autonomous consumption c) A decrease in autonomous consumption d) A decrease in Income e) An increase in IncomeAn increase in disposable income shifts Select one: a. both the consumption and savings functions downward. b. the consumption function upward and leads to a movement along the savings function. O c. neither the consumption function or the savings function because it leads to a movement along both the consumption and savings function. d. both the consumption and savings functions upward.
- If Michelle's income is reduced to zero after she loses her job, her consumption will be and her saving will be O greater than zero; greater than zero O less than zero; greater than zero O greater than zero; less than zero O less than zero; less than zeroCo If the consumption function is of the form [C= 80 + 0.4 Y, the MPS equals Lütfen birini seçin. O A. 80 O B. -0.4. O C. 0.6. O D.04 O E.-0.6. Refer to the information provided in Table 22.4 below to answer the quesiPlease no written by hand solutions Data on before-tax income, taxes paid and consumption spending (on domestic goods and services) for the Simpson family in various years are given below. BEFORE-TAX INCOME ($) TAX PAID ($) CONSUMPTION SPENDING ($) 3000 3500 3700 4000 25 000 27 000 28 000 30 000 20 000 21 350 22 070 23 600 a. Graph the Simpsons's consumption function and find their household's marginal propensity to consume. b. How much would you expect the Simpsons to consume if their income was $32 000 and they paid taxes of $5000? c. Homer Simpson wins a lottery prize. As a result, the Simpson family increases its consumption by $1000 at each level of after-tax income. ('Income' does not include the prize money.) How does this change affect the graph of their consumption function? How does it affect their marginal propensity to consume?
