A change in consumption, in response to a change in income, is
A)equilibrium consumption.
B)planned consumption.
C)autonomous consumption.
D)induced consumption.
E)unplanned consumption.

Question

Quizplus · Accepted Answer

A change in consumption in response to a change in income is known as induced consumption. Autonomous consumption refers to the level of consumption that exists even if income is zero, while equilibrium consumption is the level of consumption at which planned savings and planned investment are equal. Planned consumption refers to the amount of consumption that households plan to engage in given their income and other factors, while unplanned consumption refers to consumption that occurs due to unexpected events such as emergencies.

A Change in Consumption, in Response to a Change in Income