At the level of disposable income where the consumption function crosses the 45- degree line,
A) saving is zero.
B) saving is negative.
C) the marginal propensity to consume is 0.50.
D) consumption expenditure equals only autonomous consumption expenditure.

Question

Quizplus · Accepted Answer

At the point where the consumption function crosses the 45-degree line, consumption equals disposable income, meaning there is no saving or dissaving, so saving is zero.

At the Level of Disposable Income Where the Consumption Function