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Assume That an Increase in a Household's Disposable Income from $40,000

Question 178

Multiple Choice

Assume that an increase in a household's disposable income from $40,000 to $48,000 leads to an increase in consumption from $35,000 to $41,000, then the


A) slope of the consumption schedule is 0.75.
B) average propensity to consume is 0.75.
C) marginal propensity to save is 0.20.
D) marginal propensity to consume is 0.6.

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