Exam 12: Consumption, Real GDP, and the Multiplier

Nonconsumable goods that firms use to make other goods are

If the average propensity to consume is 1.0, the marginal propensity to consume is 0.8, and real disposable income increases by $100, the additional saving is

A situation in which spending exceeds income is

Whenever total planned expenditures differ from real GDP,

Which of the following is a flow variable?

If businesses expect the economic activity to expand,

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

-Refer to the above figure. Line ACE is called

Using real GDP on the horizontal axis instead of real disposable income implies that a marginal propensity to consume 0.75 generates for every additional $100 of real GDP

-In the above table, the level of autonomous consumption is

Real planned investment spending is inversely related to

According to the Keynesian model, an increase in autonomous investment leads to

Which of the following is false?

According to Keynes, an individual's level of saving is primarily determined by

At a level of real disposable income of 0, consumption is $4000. Then

Along the 45-degree reference line,

If real disposable income increases, the average propensity to save will

-Refer to the above figure. If real Gross Domestic Product (GDP) is $2 trillion, then

One divided by the marginal propensity to save (MPS) is the formula for

What is the result when real planned saving exceeds real planned investment spending?