The size of the marginal propensity to save
A) is negative if dissaving is present.
B) is between 0 and 1.
C) equals 1.
D) exceeds 1.
90) The MPS equals the ratio of
A) saving to real GDP.
B) the change in saving to the change in consumption expenditure.
C) saving to consumption expenditure.
D) None of the above answers is correct.
91) The marginal propensity to save equals the
A) change in savings resulting from a one dollar change in disposable income.
B) change in savings from a change in consumption expenditure.
C) average amount of income saved.
D) ability to save the same percentage of income each month.
92) When disposable income increases from $7 trillion to $7.5 trillion, consumption expenditure increase from $6.5 trillion to $6.9 trillion. The MPS is equal to
93) When disposable income equals $800 billion, planned consumption expenditure equals $600 billion, and when disposable income equals $1,000 billion, planned consumption expenditure equals $760 billion. What is the marginal propensity to save?
94) Suppose real GDP increases from $13 trillion to $14 trillion. Consequently, consumption expenditure increases from $13 trillion to $13.75 trillion. This result implies the MPS equals
D) some amount that cannot be determined without more information.
95) Between 2008 and 2009 the government reported that disposable income decreased by $300 billion and consumption expenditure decreased by $180 billion. Based on these data, the MPS equals
D) $120 billion.
96) The MPC and MPS measure changes in consumption expenditure and saving that result from changes in
A) expected inflation.
B) disposable income.
C) expected future income.
D) government expenditures on goods and services.
97) Which of the following is true?
A) MPS = MPC
B) MPS + MPC = 1
C) MPS + MPC = 0
D) MPS - MPC = 1
98) The MPC and MPS
A) sum to 1.
B) can sum to anything greater than 0.
C) sum to 100.
D) each are usually less than .5.
99) If the marginal propensity to save is 0.6, then the marginal propensity to consume is
D) not determinable.
100) For a household, the marginal propensity to save plus the marginal propensity to consume
A) equals 1.
B) equals 0.
C) equals a number that is larger the larger the household's disposable income.
D) equals a number that is smaller the larger the household's disposable income.
101) 1 - MPC equals
A) autonomous consumption.
B) the marginal propensity to save.
C) induced consumption.
D) the net national product.
102) If the MPC equals 0.75, then
A) for every $100 increase in consumption expenditure, disposable income increases by $75.
B) consumption expenditure is always more than disposable income.
C) for every $100 increase in disposable income, saving increases by $75.
D) for every $100 increase in disposable income, saving increases by $25.
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