The slope of the consumption function is equal to:
A) autonomous consumption.
B) the marginal propensity to consume.
C) the marginal propensity to save.
D) zero.

Question

Quizplus · Accepted Answer

The slope of the consumption function represents the change in consumption for each unit change in income. This is equivalent to the definition of the marginal propensity to consume (MPC), which is the fraction of a change in income that is spent on consumption. Therefore, the answer is B, the marginal propensity to consume.

The Slope of the Consumption Function Is Equal To