Exam 13: Aggregate Expenditures

The table given below reports the consumption expenditure of a nation at different levels of disposable income. Table 9.1 Refer to Table 9.1.When disposable income is $20, 000, consumption spending equals:

Dissaving occurs when the consumption function lies belowthe 45-degree line.

The average propensity to save (APS)is the proportion of disposable income that is saved.

The figure given below shows the consumption functions of an economy. Figure 9.4 Refer to Figure 9.4.Which of the following could explain a downward shift of the consumption function from C₁ to C₃?

Which of the following will cause the investment function to shift upward?

As disposable income rises:

Suppose that the consumption function crosses the 45-degree line at a disposable income level of $800.Assume further that saving equals $200 when disposable income is $1, 300.This implies that the MPC must equal 0.6.

In the table given below Y represent the aggregate expenditure of the economy on C = consumption, I = investment, G = government projects, and X = net exports. Table 9.3 Refer to Table 9.3.Compute the marginal propensity to save in the economy.

The figure given below represents the saving function of an economy. Figure 9.1 Refer to Figure 9.1.An increase in autonomous consumption would be illustrated by:

MPI refers to the percentage of additional domestic income spent on imports.

Which of the following is least likely to contribute to the volatility of investment spending?

The table given below reports the consumption expenditure of a nation at different levels of disposable income. Table 9.1 Refer to Table 9.1.At an income level of $10, 000, the APS equals -0.20.Therefore, the APC has to equal:

If it is assumed that there are absolutely no taxes in an economy, then aggregate consumption will be drawn as a function of:

The figure given below shows the aggregate expenditures function of an economy. Figure 9.5 Refer to Figure 9.5.The amount of government spending is indicated by the distance _____.

What would be the impact of an increase in foreign income on the net export function?

As household wealth increases, it will experience a(n):

Which of the following would cause a change in imports?

Other things equal, a marginal propensity to import of 0.8 implies that a $100 million increase in domestic income will lead to an $80 million decrease in net exports.

The income net of taxes is called _____.

Changes in autonomous consumption will affect the slope of the consumption function.