The consumption function shifts down if _____ fall(s).
A) taxes
B) autonomous consumption
C) government spending
D) none of the above

Question

Quizplus · Accepted Answer

The consumption function shifts down if autonomous consumption falls. Autonomous consumption is the level of consumption that would still occur if income were zero, reflecting basic consumption needs or habits that are not influenced by current income levels. A decrease in autonomous consumption directly lowers the consumption function, as it represents a decrease in the baseline level of consumption regardless of income.

The Consumption Function Shifts Down If _____ Fall(s)