Which of the following must be true if an economy has a positive level of autonomous consumption?
A)Induced consumption must be very small.
B)Savings must be greater than zero at all levels of income.
C)Savings must be less than zero at all levels of income.
D)The economy has negative savings at zero income.
E)The economy has negative induced spending at zero income.

Question

Quizplus · Accepted Answer

Autonomous consumption refers to the level of consumption that occurs even when income is zero. If an economy has a positive level of autonomous consumption, it means that households are consuming out of their past savings or borrowing, leading to negative savings at zero income, as they are consuming more than their current income of zero.

Which of the Following Must Be True If an Economy