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Questions and Answers
What is the average consumption expenditure for the top fifth of households?
What is the average consumption expenditure for the top fifth of households?
- $42,659
- $158,652
- $97,003 (correct)
- $74,090
At which income level does consumption first exceed income based on the data provided?
At which income level does consumption first exceed income based on the data provided?
- $27,442 (correct)
- $74,090
- $47,196
- $10,263
What type of relationship does the data suggest between household income and consumption?
What type of relationship does the data suggest between household income and consumption?
- Positive relationship (correct)
- Inverse relationship
- Negative relationship
- No relationship
What is the average income for the bottom fifth of households?
What is the average income for the bottom fifth of households?
Which household group has the highest average income before taxes?
Which household group has the highest average income before taxes?
What does the slope of the consumption vs. income graph represent?
What does the slope of the consumption vs. income graph represent?
Which group has the lowest average consumption expenditure?
Which group has the lowest average consumption expenditure?
What was the total disposable personal income in the United States in 1985?
What was the total disposable personal income in the United States in 1985?
Which of the following statements is true regarding household consumption and income?
Which of the following statements is true regarding household consumption and income?
Which year saw the greatest increase in total disposable personal income compared to the previous year?
Which year saw the greatest increase in total disposable personal income compared to the previous year?
In which year did the total disposable personal income first exceed 10,000 billion dollars?
In which year did the total disposable personal income first exceed 10,000 billion dollars?
What is the Y-intercept in the context of graphing total disposable personal income?
What is the Y-intercept in the context of graphing total disposable personal income?
By what approximate percentage did total disposable personal income grow from 1995 to 2000?
By what approximate percentage did total disposable personal income grow from 1995 to 2000?
Which year showed the highest aggregate national income according to the data?
Which year showed the highest aggregate national income according to the data?
In which year was the aggregate consumption the lowest according to the table?
In which year was the aggregate consumption the lowest according to the table?
How much did aggregate national income increase from 2000 to 2010?
How much did aggregate national income increase from 2000 to 2010?
What was the aggregate consumption figure in 2006?
What was the aggregate consumption figure in 2006?
What is the trend in aggregate national income from 1930 to 2012 based on the data provided?
What is the trend in aggregate national income from 1930 to 2012 based on the data provided?
In which decade was the increase in aggregate national income the most substantial compared to previous decades?
In which decade was the increase in aggregate national income the most substantial compared to previous decades?
What percentage increase in aggregate consumption is there from 1980 to 1990?
What percentage increase in aggregate consumption is there from 1980 to 1990?
What was the aggregate national income in 2005, based on the provided data?
What was the aggregate national income in 2005, based on the provided data?
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Study Notes
Income and Consumption Relationship
- There is a positive relationship between household income and consumption.
- This means that as income increases, consumption also increases.
Plotting Data
- X-axis represents household income.
- Y-axis represents household consumption.
- Slope measures how consumption changes in response to changes in income.
- A steeper slope indicates a larger change in consumption for a given change in income.
Table 2A: Average Income and Consumption by Household Income Groups
- Bottom fifth of households had an average income of 10,263andconsumedanaverageof10,263 and consumed an average of 10,263andconsumedanaverageof22,304.
- Top fifth of households had an average income of 158,652andconsumedanaverageof158,652 and consumed an average of 158,652andconsumedanaverageof97,003.
Table 3A: Aggregate National Income and Consumption in the United States (1930-2012)
- National income and consumption are positively related.
- As national income increased, aggregate consumption also increased.
Graphing Two Variables
- Origin: The point where the X-axis and Y-axis intersect
- Y-intercept: The point where the graph intersects the Y-axis.
- X-intercept: The point where the graph intersects the X-axis.
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