If the price index in year A is 130, this means that:
A. Prices in year A are on average 130 percent higher than in the base year
B. Prices in year A are on average13 times that in the base year
C. Prices in year A are on average 30 percent higher than in the base year
D. Nominal GDP is 130 percent higher than real GDP in year A
C. Prices in year A are on average 30 percent higher than in the base year
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Exhibit 8-1 Disposable income and consumption data Disposable Income(Y) Consumption(C) 0 500 1,000 1,400 2,000 2,200 3,000 2,900 4,000 3,500 5,000 4,000 In Exhibit 8-1, when disposable income is increased from $2,000 to $3,000 to $4,000, the marginal propensity to consume
A. remains constant. B. increases from 0.6 to 0.7. C. decreases from 0.8 to 0.7. D. decreases from 0.7 to 0.6.