Which of the following increases the slope of the consumption function?
A) an increase in the marginal propensity to consume
B) a decrease in the value of consumer durables
C) an increase in consumer confidence
D) an increase in consumer wealth

Question

Quizplus · Accepted Answer

An increase in the marginal propensity to consume means that consumers will spend a higher proportion of their income, leading to a steeper slope on the consumption function. The other choices may affect the level of consumption, but do not necessarily change the slope of the function.

Which of the Following Increases the Slope of the Consumption