An increase in consumer confidence will
A) not change autonomous consumption and rotate the consumption function upward.
B) not change autonomous consumption and rotate the consumption function downward.
C) increase autonomous consumption and shift the consumption function upward.
D) decrease autonomous consumption and shift the consumption function downward.

Question

Quizplus · Accepted Answer

When consumer confidence increases, individuals are more willing to spend money and therefore autonomous consumption increases. This shift in behavior will cause the consumption function to shift upward.

An Increase in Consumer Confidence Will