Exam 12: Consumption, Real GDP, and the Multiplier

According to the Keynesian model, what are the two components of consumption spending? What determines how consumption changes when real disposable income changes? Explain.

-According to the above table, the marginal propensity to consume is

-Use the above table. We can infer from the table that when real disposable income is $175

If the marginal propensity to consume (MPC) is 0.8, the spending multiplier will be

Ignoring the government and foreign sectors, there is an unplanned decrease in inventories of $100 billion at the current level of real national income of $20 trillion. From this information, we know that

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

The income-expenditure model of real GDP determination is due to the work of

The non-income determinants of consumption include all of the following EXCEPT

If the marginal propensity to consume (MPC) is 0.95, then the multiplier for a change in autonomous spending will be

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

-Refer to the above figure. Autonomous consumption equals

When the marginal propensity to consume (MPC) increases

The following would cause an upward shift in the C + I + G + X curve EXCEPT

-Refer to the above figure. If real GDP is $4 trillion, then

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

Investment is

What effect would taxation have on real consumption spending when government spending is autonomous?

As real disposable income decreases, consumption expenditures

Which formula is correct?

Which of the following represents the relationship between disposable income (DI), consumption (C), and saving (S)?