Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![QUESTION 19
40
36
32
28
24
20
16
12
8
4
0
-4
E,Q
F
16
19. If the actual level of income is 36, what would be the resulting unplanned inventory investment?
O (a) -2
O (b) zero
O (c) 2
(d) 4
(e) 5
24
32
40
QUESTION 20
20. According to Keynes's Consumption function,
a) Consumption spending is a function of disposable (after-tax) income (Yd).
b) There cannot be any consumption without disposable income.
c) Total consumption spending is composed of autonomous consumption, independent of income (Ca), and induced consumption, determined by disposable income.
d) The induced consumption component is equal to a constant proportion of disposable income.
e) The induced consumption is equal to the marginal propensity to consume times disposable income
Of) The consumption function Is modified in the Lecture Notes to a simplified version where consumption is a function of real income.
Og) Autonomous consumption cannot be changed by other factors.
AE
S
+Q](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8fd71a05-cce6-42ce-8872-636d0d92cbc9%2F9e257efb-b5c0-4a7d-8dcb-ce0d9fa31314%2Fn9qwxwc_processed.png&w=3840&q=75)
Transcribed Image Text:QUESTION 19
40
36
32
28
24
20
16
12
8
4
0
-4
E,Q
F
16
19. If the actual level of income is 36, what would be the resulting unplanned inventory investment?
O (a) -2
O (b) zero
O (c) 2
(d) 4
(e) 5
24
32
40
QUESTION 20
20. According to Keynes's Consumption function,
a) Consumption spending is a function of disposable (after-tax) income (Yd).
b) There cannot be any consumption without disposable income.
c) Total consumption spending is composed of autonomous consumption, independent of income (Ca), and induced consumption, determined by disposable income.
d) The induced consumption component is equal to a constant proportion of disposable income.
e) The induced consumption is equal to the marginal propensity to consume times disposable income
Of) The consumption function Is modified in the Lecture Notes to a simplified version where consumption is a function of real income.
Og) Autonomous consumption cannot be changed by other factors.
AE
S
+Q
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