Autonomous consumption is
A) consumption spending that is earned rather than transferred from the government.
B) consumption spending that does not depend on the level of income.
C) the amount spent on consumption when saving equals zero.
D) consumption spending when the marginal propensity to consume is 1.

Question

Quizplus · Accepted Answer

Autonomous consumption is the consumption spending that does not depend on the level of income. In other words, it is the minimum level of consumption expenditure that individuals must incur even if they have no income. For example, even if someone is unemployed, they still have to spend a certain amount on basic necessities like food, rent, and utilities. This level of spending is considered autonomous consumption because it is not influenced by changes in income.

Autonomous Consumption Is