Autonomous consumption is
A) consumption expenditure that does not depend on the level of GDP or disposable income.
B) consumption expenditure that is earned rather than transferred from the government.
C) the amount spent on consumption when saving equals zero.
D) consumption expenditure when the marginal propensity to consume is 1.

Question

Quizplus · Accepted Answer

Autonomous consumption is defined as the consumption expenditure that does not depend on the level of GDP or disposable income. This means that even if a person's income or the overall GDP were to decrease, their autonomous consumption would remain the same. Examples of autonomous consumption include spending on necessities such as food and housing.

Autonomous Consumption Is