The amount of autonomous consumption in an economy is measured by the:
A)the intercept of the consumption function when disposable income is positive.
B)the intercept of the consumption function where actual consumption is above the 45-degree line.
C)the intercept of the consumption function when disposable income is zero.
D)the intercept of the consumption function when disposable income is negative.

Question

Quizplus · Accepted Answer

The amount of autonomous consumption is the intercept of the consumption function when disposable income is zero. This intercept represents the level of consumption that occurs regardless of income or the level of economic activity.

The Amount of Autonomous Consumption in an Economy Is Measured