Exam 11: Consumption, Real GDP, and the Multiplier

A permanent reduction in planned real investment spending leads to

If the multiplier has a value of 1, then the value of the marginal propensity to save (MPS)is

The ratio of the change in the equilibrium level of real GDP to the change in autonomous real expenditures is the

Autonomous consumption is defined as

The marginal propensity to consume explains how much of the next dollar of disposable income

Of the relationships below, which is the least stable?

The equation is the

The terms "saving" and "savings" differ in that

For an investment to be considered autonomous, it must

If the marginal propensity to consume (MPC)is 0.9, the spending multiplier will be

Along the portion of the consumption function that lies above the 45-degree line, saving is

-Refer to the above figure. If the MPC is unchanged and level of autonomous consumption increases, what occurs?

According to Keynes, the most important determinant of an individual's real saving is

Saving is

If the level of consumption is $100 billion and disposable income is $125 billion, then the

-In the above figure, what is autonomous consumption?

In economics, the term "autonomous" means

When you purchase Gap clothing and baseball tickets

The slope of the consumption function is the

The larger the marginal propensity to consume