If Larry Page, one of the cofounders of Google, spends $100,00 0 on the new Tesla electric vehicle because he has an optimistic view of the future, then: O income in the economy increases by $1,000,000, if the MPC is 0.8. O income in the economy increases by $500,000, if the MPC is 0.9. O Income in the economy increases by $400,000, if the MPC is 0.75. O income in the economy increases by $300,000, if the MPC is 0.5.
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- 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.One of these four answers best explains the effect of disposable income on consumption. Which one? O Disposable income does not determine consumption. O Disposable income is the most powerful determinant of income and determines how much an individual consumes. O When an individual has more disposable income, he or she is likely to consume less. O Disposable income is an important determinant of expected future income.When the consumption function lies above the 45-degree line, households * O Spend on consumption an increasing percentage of any increase in income O Spend on consumption a decreasing percentage of any increase in income O Are dissaving O Save all of any increase in income
- Columns 1 through 4 of the accompanying table show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are $18, $6, $4, and $24, respectively, and that Ricardo has an income of $105. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? How many dollars will Ricardo choose to save? Check your answers by substituting them into the algebraic statement of the utility‑maximizing rule. In other words, show it works when using this rule.Consumption expenditures in the U.S. usually account for approximately 40 O 50 O 60 O 70 80 percent of GDP.Joe likes eating candy and drinking soda, The price of a bar of candy is $2 while the price of a can.of soda is $3. joe has a budeet of 529. Suppose that candy and soda can only be purchased and consumed as whole units (in other words it is impossible for Joe to purchase 1/3 of a bar of candy or A/5 of a can of soda). Furthermore, assume that it is impossible for Joe to spend more than his budget (that is, his total expenditure on candy and soda cannot exceed his budget). The following table describes the marginal benefit (expressed in $) he obtains from each bar of candy and can of soda Marginal Benefit from Marginal Benefit from Soda (in $) Unit Candy (in $) 180 180 160 150 3 140 120 60 5. 100 45 60 30 7. 40 15 8 10 -30 9. 60 -90 10 -100 -120 Joe's optimal consumption bundle includes (enter a numerical answer here) bars of candy and (enter o (enter a numerical answer here) cans of soda, and the total benefit he derives from the consumption of the optimal bundle is $ numerical answer…
- Columns 1 through 4 in the following table show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are, respectively, $18, $6, $4, and $24 and that Ricardo has an income of $106. a. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? b. How many dollars will Ricardo choose to save? c. Check your answers by substituting them into the algebraic statement of the utility-maximizing rule.25 Columns 1 through 4 in the following table show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are, respectively, $9, $3, $2, and $6 and that Ricardo has an income of $71. Column 1 Column 2 Column 3 Column 4 Column 5 Units of Good A Units of Units of Units of MU MU MU MU Good B Good C Good D Number of Dollars Saved MU 1 72 1 24 1 15 1 36 1 5 2 54 2 15 2 12 2 30 2 4 3 45 3 12 3 8 3 24 3 3 4 36 4 9 4 7 4 18 4 2 5 27 5 7 5 5 5 13 5 1 6 18 6 5 6 4 6 7 6 0.50 7 15 7 2 7 3.5 7 4 7 0.25 8 12 8 1 8 3 8 2 8 0.13 Instructions: Enter your answers as a whole number. a. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? 4 units of A 3 units of B units of C units of D b. How many dollars will Ricardo choose to save?Question Another important aspect of Tourism Economics is the multiplier effect, which refers to the additional economic activity generated by tourism spending. When tourists spend money in a destination, it circulates through the local economy, benefiting not just the direct recipients of this spending but also other businesses and their employees. For example, tourists spending money in local restaurants support not only the restaurant staff but also local suppliers and their workers. The multiplier effect in Tourism Economics is essential because it: A) Reduces overall economic activity B) Only benefits the tourism sector C) Generates additional economic activity beyond the initial spending D) Leads to economic stagnation
- Use the table below to answer the following question. Income (Dollars) 20,000 24,000 O 0.75 What is the marginal propensity to consume? O 0.875 O 0.90 Consumption (Dollars) O 1.33 18,000 21,500The accompanying graph represents the aggregate consumption function for the small island nation of Pineapple Paradise. The people of Pineapple Paradise expect their future 10,000 disposable income to increase. Use the graph to show an 9,000 increase in consumption expenditures. 8,000 7,000 What is the new level of aggregate autonomous consumer ,000 Aggregate Consumption Function spending? ,000 $2000 4,000 $4000 3,000 $1000 O $3000 2,000 1,000 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 Disposable Income Çonsumer Spending,Suppose that Amazon decides to spend $10 million on a new distribution center. If the marginal propensity to consume is .8. then how much will GDP go up by once the multiplier process has played out? O $10 million O $20 million O $40 milion O $50 million