When the consumption function is plotted on a graph,

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The consumption function is typically plotted with consumption (C) on the vertical axis and disposable income (Yd) on the horizontal axis. This allows for a straightforward representation of the relationship between changes in disposable income and changes in consumption. As disposable income increases, consumption tends to increase as well, although not necessarily one-to-one. This relationship is captured by the slope of the consumption function, which is known as the marginal propensity to consume (MPC). The vertical axis is labeled with consumption because it is the dependent variable in this relationship, while disposable income is the independent variable.

When the Consumption Function Is Plotted on a Graph