The positive slope of the consumption function indicates that
A)when prices fall consumers spend more.
B)the amount of household wealth is subject to change.
C)consumers increase their total consumption expenditure when disposable income increases.
D)consumers spend less out of each extra dollar of income.

Question

Quizplus · Accepted Answer

The positive slope of the consumption function indicates that as disposable income increases, consumers tend to increase their total consumption expenditure.

The Positive Slope of the Consumption Function Indicates That