Which one of the following will shift the consumption function upward?
A)Higher interest rates.
B)Expectations that the economy will grow in the future.
C)A decrease in money holdings.
D)Higher capacity utilization rates.
E)A tax increase.

Question

Quizplus · Accepted Answer

Expectations that the economy will grow in the future can lead to increased consumer confidence, prompting households to spend more, thus shifting the consumption function upward.

Which One of the Following Will Shift the Consumption Function