The consumption function illustrates that:
A)saving increases as disposable income decreases.
B)consumption increases as saving increases.
C)consumption increases as disposable income increases.
D)consumption increases as disposable income decreases.
E)consumption increases as investment increases.

Question

Quizplus · Accepted Answer

The consumption function shows that consumption increases as disposable income increases. As people have more money available to spend, they tend to increase their consumption. The other choices are not supported by the consumption function.

The Consumption Function Illustrates That