If a $100 million increase in total income leads to a $62 million increase in consumption, the slope of the consumption function is:
A)negative.
B)0.62.
C)zero.
D)0.38.

Question

Quizplus · Accepted Answer

The slope of the consumption function is equal to the change in consumption over the change in income. In this case, the slope would be:

(change in consumption) / (change in income) = ($62 million) / ($100 million) = 0.62

Therefore, the answer is B.

If a $100 Million Increase in Total Income Leads to a $62