If an increase in a household's disposable income from $10,000 to $12,000 boosts its consumption expenditure from $8,000 to $9,000, the

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The slope of the consumption function, also known as the marginal propensity to consume (MPC), is calculated as the change in consumption divided by the change in disposable income. Here, the change in consumption is $1,000 ($9,000 - $8,000) and the change in disposable income is $2,000 ($12,000 - $10,000). Thus, the slope is $1,000 / $2,000 = 0.5.

If an Increase in a Household's Disposable Income from $10,000