________ describes the relationship between consumption spending and disposable income.
A)Household wealth
B)The liquidity trap
C)The consumption function
D)The paradox of thrift

Question

Quizplus · Accepted Answer

The consumption function describes the relationship between consumption spending and disposable income. It illustrates the amount of total spending that will occur at different levels of income, assuming other factors such as interest rates and expectations remain constant. The consumption function is a key concept in macroeconomics and helps to explain why changes in income levels can cause shifts in aggregate demand.

________ Describes the Relationship Between Consumption Spending and Disposable Income