Figure 7.2 45° C, S Y=200 In Figure 7.2, if income is $200, then: consumption is also $200. saving is also $200. O consumption is zero. the intercept of the consumption function is negative.
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- assume you are given a $100 raise, and decide to save $20 of that money. also assume that if you make zero income in a year, you will still spend $7000. a.) what is your consumption function? b.) if you earn $20000 in a year how much will you spend? c.) will you be able to save while earning the above income?Figure 2 C3 C2 C1 45° Y2 Y1 Aggregate income Aggregate savingIf Michelle's income is reduced to zero after she loses her job, her consumption will be and her saving will be O greater than zero; greater than zero O less than zero; greater than zero O greater than zero; less than zero O less than zero; less than zero
- The table given below shows the disposable income and consumption of a household. In the table below, saving: Table 9.1 Disposable Income ($) Consumption ($) 1,000 800 1,100 880 1,200 960 1,300 1,040 1,400 1,120 O is negative at a disposable income of $1,400. O is negative at a disposable income of $1,000. O decreases as disposable income increases. O remains constant as disposable income increases.Which of the following is not a valid expenditure function? OU P.P, O UP, O None of these can be expenditure functions O (P. + P,) VŨ P+PFigure 7.2 45° C, S S Y=200 In Figure 7.2, if income is $200, then: consumption is $100. saving is also $200. consumption is zero. O saving is zero.
- If Carol's disposable income increases from $1,200 to $1,700 and her level of saving increases from minus $100 to a plus $100, her marginal propensity to O save is 3/5. O consume is 1/2. O consume is 3/5. O consume is 2/5.Assume the following consumption schedule: C= 20 + 0.9 Y, where C is consumption and Y is disposable income. At $1,100 level of disposable income: (show your cacuators) a. Find out the level of saving and consumption? b. How much are the APC and APS (to one decimal place)? c. If dispr able income increased to $2,800 and saving is $345 now. What are MPC and MPŚ (to two decimal places)?I consumed all my income at every level of income.Draw my consumption and saving function.What are my MPC and MPS? Explain why it must always be true that MPC+MPS equal to 1?
- If income increases by $100 and saving increases by $25, the slope of the consumption function equals O a. 3/4 O b. 1/2 O c. 1/5 O d. 1/4 О е. 3/5Suppose the economy's saving schedule shifts from S1 to S 2 as shown in the above diagram. We can say that its: S2 Disposable income MPC has increased. MPS has increased. O APS has decreased at all levels of disposable income. O APS has increased at all levels of disposable income. SavingAssume the following consumption schedule: C = 20 + 0.9Y, where C is consumption and Y is disposable income. At a(n) $1,000 level of disposable income, the level of saving is $80. $920. $180. $18.