Consumption depends ______ on disposable income, and investment depends ______ on the real interest rate.

Name: Consumption depends ______ on disposable income, and investment depends ______ on the real interest rate.
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Question

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Consumption typically increases as disposable income increases, indicating a positive relationship. Investment, however, tends to decrease as the real interest rate increases because higher rates make borrowing more expensive, indicating a negative relationship.

Consumption Depends ______ on Disposable Income, and Investment Depends ______

Consumption Depends on Disposable Income, and Investment Depends