Which one of the following will cause a movement down along an economy's consumption schedule?
A) An increase in stock prices.
B) A decrease in stock prices.
C) An increase in consumer indebtedness.
D) A decrease in disposable income.

Question

Quizplus · Accepted Answer

A decrease in disposable income will cause consumers to decrease their consumption, resulting in a movement down along the consumption schedule. An increase in consumer indebtedness could potentially lead to a movement up along the consumption schedule if consumers are using borrowed funds to increase their consumption. Changes in stock prices are not directly related to consumption and therefore do not impact the consumption schedule.

Which One of the Following Will Cause a Movement Down