Solved

If the Marginal Propensity to Save Is 0

Question 97

Multiple Choice

If the marginal propensity to save is 0.2 and income rises by $5,000, how much of this $5,000 will be consumed?

A) $625
B) $1,000
C) $4,000
D) $5,000

Related Questions

Q48: Tax changes generally have less of an

Q92: (Table: Keynesian Equilibrium Analysis with Taxes and

Q93: In the full aggregate expenditure model with

Q95: Expectations of a future general price increase

Q98: (Figure: Aggregate Expenditures) The figure shows the

Q102: According to the balanced budget multiplier, an

Q104: Increases in taxes result in increased consumption

Q166: Saving is zero when the economy is

Q201: A horizontal investment schedule assumes that investment

Q232: Keynes believed that the economy is self-correcting.