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Average Propensity to Consume and Save
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Average Propensity to Consume and Save
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14. Income and Consumption / Average Propensity to Consume and Save / Problem 4
Problem 4
In a recession, why might a government be interested in the marginal propensity to consume of its citizens?
A
To predict how much additional income will be saved rather than spent.
B
To determine the average income of its citizens.
C
To estimate the potential impact of fiscal stimulus on overall consumption.
D
To calculate the total consumption of the economy.
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