In the above figure, when real disposable income is less than 600, then
A) consumption is less than disposable income.
B) consumption is more than disposable income.
C) consumption is the same as disposable income.
D) the MPC will fall.

Question

Quizplus · Accepted Answer

When real disposable income is less than 600, consumption is more than disposable income, indicating that individuals are consuming more than they earn, possibly by drawing down savings or borrowing.

In the Above Figure, When Real Disposable Income Is Less