The difference between disposable income and consumption spending is
A)transfer payments.
B)personal taxes.
C)net exports.
D)personal investment.
E)personal saving.

Question

Quizplus · Accepted Answer

Disposable income is the total amount of money households have available for spending or saving after taxes and transfer payments have been deducted from their total income. Consumption spending, on the other hand, refers to the portion of disposable income that households spend on goods and services. Therefore, the difference between disposable income and consumption spending is personal saving (option E).

The Difference Between Disposable Income and Consumption Spending Is