A. The average propensity to consume gets nearer in value of the marginal propensity to consume
B. The average propensity to consume diverges in value from the marginal propensity to consume
C. The average propensity to consume falls
D. The average propensity to consume always approaches 0
Related Mcqs:
- When an increase in government purchases increases the income of some people, and those people spend some of that increase in income on additional consumer goods, we have seen a demonstration of ?
A. The multiplier effects
B. supply side economics
C. None of these answers
D. The crowding out effect - Within the circular flow of income, an increase in domestic income will tend to increase ?
A. exports
B. taxes
C. inventories
D. imports - The World Bank’s GNP per capita classification for low income middle income and high income countries respectively is ?
A. less than $900, $900-$9000 and more than $9000
B. less than $5000, $5000-$15000 and more than $15000
C. less than $100, $100-$1000 and more than $1000
D. less than $5000, $5000-$150000 and more than $150000 - A tax for which high income taxpayers pay a smaller fraction of their income than do low income taxpayers is known as ?
A. a proportional tax
B. a regressive tax
C. an equitable tax
D. a progressive tax - If the income tax rate changes from 30% to 40% on income over Rs30,000 and a person’s income is Rs 31,000 then her marginal tax rate is ?
A. 30%
B. 10%
C. 70%
D. 40% - If an increase in investment leads to a bigger increase in national income this called the ?
A. Accelerator
B. Aggregate demand
C. Monetarism
D. Multiplier - An increase in consumer income will increase demand for a _________ but decrease demand for a?
A. substitute good, inferior good
B. normal good inferior good
C. inferior good normal good
D. normal good, complementary good - If an increase in a consumer’s income causes the consumer to increase his quantity demand of a good, then the good is ?
A. a complementary good
B. an inferior good
C. a normal good
D. a substitute good - Disposable income is the part of households income left after the deduction of ?
A. income tax and social security payments
B. taxes and the addition of benefits
C. income tax
D. contractual payments such as pensions and mortgages - An increase in consumption at any given level of income is likely to lead to ?
A. A fall is savings
B. An increase in exports
C. A fall in taxation revenue
D. A decrease in import spending
