Question 1

Conspicuous consumption

Accepted Answer

A)  was a phrase coined by Karl Marx.
B)  was a phrase coined by Thorstein Veblen.
C)  was a phrase coined by Milton Friedman.
D)  was a phrase coined by Adam Smith.

Question 2

As disposable income grows,

Accepted Answer

A)  both autonomous C and induced C rise.
B)  both autonomous C and induced C fall.
C)  autonomous C rises and induced C falls.
D)  autonomous C falls and induced C rises.
E)  autonomous C stays the same and induced C rises.

Question 3

As disposable income rises

Accepted Answer

A)  induced consumption rises and autonomous consumption stays the same.
B)  autonomous consumption rises and induced consumption stays the same.
C)  both induced and autonomous consumption rise.
D)  both induced and autonomous consumption stay the same.

Question 4

Suppose autonomous consumption is 3000,induced consumption is 500 and disposable income is 2500.We may conclude that the

Accepted Answer

A)  APC and APS are both negative.
B)  APC and APS are both positive.
C)  APC is positive and APS is negative.
D)  APS is positive and APC is negative.

Question 5

$$\begin{array}{l}
\begin{array} { cc } 
\text { Disposable Income}&{ Consumption }\
0 & \$ 300 \text { billion } \
\$ 400 \text { billion } & 600 \text { billion } \
800 \text { billion } & 900 \text { billion } \
1200 \text { billion } & 1200 \text { billion } \
1600 \text { billion } & 1500 \text { billion }
\end{array}
\end{array}$$
-How much is the APC when disposable income is $1200 billion?

Accepted Answer

The answer of \[\begin{array}{l}
\begin{array} { cc } 
\text { Disposable...

Question 6

Conspicuous consumption

Accepted Answer

A)  was a phrase coined by Thorstein Veblen.
B)  is what is meant by the phrase "keeping up with the Joneses."
C)  is a way the wealthy,among others,advertise their wealth.
D)  was written about in The Theory of the Leisure Class.
E)  All the choices are true.

Question 7

When disposable income is 2000,how much is consumption?

Accepted Answer

The answer of When disposable income is 2000,how much is...

Question 8

Disposable Income Consumption 0$1 trillion $1 trillion 1.5 trillion 2 trillion 2.0 trillion 3 trillion 2.5 trillion 4 trillion 3.0 trillion \begin{array}{l}	ext { Disposable Income Consumption }\\begin{array} { c c } 0 & \$ 1 	ext { trillion } \\$ 1 	ext { trillion } & 1.5 	ext { trillion } \2 	ext { trillion } & 2.0 	ext { trillion } \3 	ext { trillion } & 2.5 	ext { trillion } \4 	ext { trillion } & 3.0 	ext { trillion }\end{array}\end{array} Disposable Income Consumption 0$1 trillion 2 trillion 3 trillion 4 trillion ​$1 trillion 1.5 trillion 2.0 trillion 2.5 trillion 3.0 trillion ​​ 
-How much is induced consumption when disposable income is $4 trillion?

Accepted Answer

A)  0
B)  $1 trillion
C)  $2 trillion
D)  $2.5 trillion

Question 9

The consumption function

Accepted Answer

A)  is a relationship between annual consumption and annual disposable income in an economy.
B)  will shift upward if aggregate household wealth declines.
C)  implies that annual consumption in an economy will be zero if disposable income is zero.
D)  is a flat line with zero slope.

Question 10

Which of the following is not considered a determinant of the level of consumption?

Accepted Answer

A)  Credit availabilities
B)  Capacity utilization
C)  Keeping up with the Joneses
D)  Consumer expectations

Question 11

At what level of disposable income is saving 1400?

Accepted Answer

The answer of At what level of disposable income is...

Question 12

$$\begin{array} { c c } 
\text { Disposable Income } & \text { Consumption } \
0 & \$ 4 \text { billion } \
\$ 5 \text { billion } & \$ 8 \text { billion } \
\$ 10 \text { billion } & \$ 12 \text { billion } \
\$ 15 \text { billion } & \$ 16 \text { bllion } \
\$ 20 \text { billion } & \$ 20 \text { billion } \
\$ 25 \text { billion } & \$ 24 \text { billion }
\end{array}$$
-How much is induced consumption when disposable income is $20 billion?

Accepted Answer

The answer of \[\begin{array} { c c } 
\text {...

Question 13

When disposable income rises,autonomous consumption __________.

Accepted Answer

The answer of When disposable income rises,autonomous consumption __________....

Question 14

If the APC is .7,we save

Accepted Answer

A)  3 percent of our income.
B)  7 percent of our income.
C)  30 percent of our income.
D)  70 percent of our income.

Question 15

Statement I.APC + APS = 1.
Statement II.MPC + MPS = 1.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.

Question 16

Which is the most accurate statement?

Accepted Answer

A)  Most Americans save for the same reason.
B)  Poor people,on the average,save a higher percentage of their income than the rich.
C)  The permanent income hypothesis has had a virtually perfect record in predicting consumer behavior.
D)  The tremendous expansion of bank credit cards,installment credit and consumer loans has contributed substantially to the consumer binge of the last dozen years.

Question 17

Today,people spend more than _____ of their incomes on services.

Accepted Answer

A)  one-third
B)  one-half
C)  two-thirds
D)  three-quarters

Question 18

Which of the following statements is true?

Accepted Answer

A)  According to the permanent income hypothesis,a person who received a windfall of say $100,000 would spend most of it that year.
B)  As disposable income rises,induced consumption falls.
C)  The minimum amount that people will spend if disposable income is zero is called induced consumption.
D)  A rapid increase in the prices of residential housing results in an increase in consumption due to the wealth effect.

Question 19

When disposable income is 1000,how much is consumption?

Accepted Answer

The answer of When disposable income is 1000,how much is...

Question 20

If the market for durable goods is saturated,most likely

Accepted Answer

A)  consumption will rise.
B)  consumption will fall.
C)  consumption will not be affected.

Exam 5: The Household Consumption Sector

Conspicuous consumption

Correct Answer
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When disposable income is 2000,how much is consumption?

Correct Answer
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As disposable income rises

Correct Answer
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If the market for durable goods is saturated,most likely

Correct Answer
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Today,people spend more than _____ of their incomes on services.

Correct Answer
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As disposable income grows,

Correct Answer
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Conspicuous consumption

Correct Answer
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The consumption function

Correct Answer
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Statement I.APC + APS = 1. Statement II.MPC + MPS = 1.

Correct Answer
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If the APC is .7,we save

Correct Answer
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Suppose autonomous consumption is 3000,induced consumption is 500 and disposable income is 2500.We may conclude that the

Correct Answer
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Which of the following statements is true?

Correct Answer
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When disposable income rises,autonomous consumption __________.

Correct Answer
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Which is the most accurate statement?

Correct Answer
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When disposable income is 1000,how much is consumption?

Correct Answer
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Which of the following is not considered a determinant of the level of consumption?

Correct Answer
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At what level of disposable income is saving 1400?

Correct Answer
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Exam 5: The Household Consumption Sector

Conspicuous consumption

Correct AnswerverifiedShow Answer

When disposable income is 2000,how much is consumption?

Correct AnswerverifiedShow Answer

As disposable income rises

Correct AnswerverifiedShow Answer

If the market for durable goods is saturated,most likely

Correct AnswerverifiedShow Answer

Today,people spend more than _____ of their incomes on services.

Correct AnswerverifiedShow Answer

As disposable income grows,

Correct AnswerverifiedShow Answer

Conspicuous consumption

Correct AnswerverifiedShow Answer

The consumption function

Correct AnswerverifiedShow Answer

Statement I.APC + APS = 1. Statement II.MPC + MPS = 1.

Correct AnswerverifiedShow Answer

If the APC is .7,we save

Correct AnswerverifiedShow Answer

Suppose autonomous consumption is 3000,induced consumption is 500 and disposable income is 2500.We may conclude that the

Correct AnswerverifiedShow Answer

Which of the following statements is true?

Correct AnswerverifiedShow Answer

When disposable income rises,autonomous consumption __________.

Correct AnswerverifiedShow Answer

Which is the most accurate statement?

Correct AnswerverifiedShow Answer

When disposable income is 1000,how much is consumption?

Correct AnswerverifiedShow Answer

Which of the following is not considered a determinant of the level of consumption?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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At what level of disposable income is saving 1400?

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