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10 terms

AP Macro Ch 8-

STUDY
PLAY
The conusumption schedule shows the various amounts that households plan to (save, consume) _____ at various levels of disposable income, and the saving schedule shows the various amounts that households plan to ____.
consume, save
Both consumption and saving are (directly, indirectly) _______ related to the level of disposable income. At lower levels of disposable income, households tend to spend a (smaller, larger) _____ proportion of this income and save a ________ proportion, but at higher levels, they tend to spend a _____ proportion and save a ____ proportion. At the break-even income, consumption is (greater than, less than, equal to) _____ disposable income.
directly, larger, smaller, smaller, larger, equal to
As disposable income falls, the APC will (rise, fall) _____ and the APS will _____.
rise, fall
The sum of APC and APS is equal to (0, 1) _____.
1
The MPC is the change in (consumption, income) _______ divided by the change in _______.
consumption, income
The MPS is the change in (saving, income) ______ divided by the change in _____.
saving, income
The sum of MPC and MPS is equal to (0, 1) _____
1
The MPC is the numerical value of the slope of the (consumption, saving) ______ schedule, and the MPS is the numerical value of the slope of the _____ schedule.
consumption, saving
The most inmportant determinants of consumption spending, other than the level of income, are:
a. ______
b. _____
c. ______
d. _____
e. _____
wealth, expectations, taxation, household debt, real interest rate
An increase in the consumption schedule means that the consumption schedule shifts (upward, downward) ____ and a decrease in the consumption schedule means that it will shift ______, and these shifts occur because of a change in one of the nonincome determinants. An increase in the amount consumed occurs because of an increase in (income, stability) _____.
upward, downward, income