Question : 37) In the figure above, when disposable income equals $10 : 1240593

37) In the figure above, when disposable income equals $10 trillion,

A) consumption expenditure is greater than disposable income, so consumers are dissaving.

B) consumption expenditure is less than disposable income, so consumers are dissaving.

C) consumption expenditure is greater than disposable income, so consumers are saving.

D) consumption expenditure is less than disposable income, so consumers are saving.

E) consumption expenditure is greater than disposable income but it is not possible to determine if consumers are saving or dissaving.

38) In the figure above, when disposable income equals $20 trillion,

A) consumption expenditure is greater than disposable income, so consumers are dissaving.

B) consumption expenditure is less than disposable income, so consumers are dissaving.

C) consumption expenditure is greater than disposable income, so consumers are saving.

D) consumption expenditure is less than disposable income, so consumers are saving.

E) consumption expenditure is less than disposable income but it is not possible to determine if consumers are saving or dissaving.

39) In the figure above, what is the MPC?

A) 0.50

B) 0.75

C) 0.80

D) 0.90

E) 1.00

40) The fraction of a change in disposable income that is spent on consumption is the

A) marginal propensity to consume.

B) marginal buying power of money.

C) expected future disposable income.

D) marginal dissaving ratio.

E) marginal propensity to dissave.

41) The consumption function shows that when disposable income increases by one dollar, consumption expenditure

A) increases by one dollar.

B) increases by more than a dollar.

C) increases by less than a dollar.

D) does not change.

E) decreases by less than a dollar.

42) The MPC is equal to the

A) change in consumption expenditure divided by the change in disposable income that brought it about.

B) change in consumption expenditure divided by the total disposable income that brought it about.

C) level of consumption expenditure divided by the level of total disposable income that brought it about.

D) level of consumption divided by the change in disposable income that brought it about.

E) change in disposable income divided by the change in consumption expenditure.

43) The marginal propensity to consume equals

A) consumption expenditure divided by disposable income.

B) consumption expenditure divided by the change in disposable income.

C) the change in consumption expenditure divided by the change in disposable income.

D) the change in consumption expenditure divided by disposable income.

E) the change in autonomous consumption divided by the change in induced consumption.

44) The marginal propensity to consume is

A) another name for consumption expenditure.

B) disposable income minus consumption expenditure.

C) the change in disposable income minus the change in consumption expenditure.

D) the change in consumption expenditure divided by the change in disposable income that brought it about.

E) another name for autonomous consumption expenditure.

45) The smaller the amount saved out of a change in disposable income, the

A) smaller the MPC.

B) more horizontal the consumption function.

C) larger the MPC.

D) smaller is autonomous consumption.

E) more net taxes affect consumption.

46) Jane supports herself at college by working in a bookstore earning $300 a month, which she spends entirely every month. If she gets a salary increase of $100 a month, she spends $90 more dollars on consumption expenditure. Jane’s MPC is equal to

A) 1.00.

B) 0.90.

C) $90.

D) 0.10.

E) 0.50.