The consumption function is a plot of the:
A)level of consumption associated with each level of income.
B)average marginal propensity to consume over time.
C)level of government spending associated with each level of income.
D)price of consumer goods and services over time.

Question

Quizplus · Accepted Answer

The consumption function shows the relationship between consumption and income, by plotting the level of consumption associated with each level of income. So, option A is the correct answer. Option B refers to a different concept, the average marginal propensity to consume which is not the same as the consumption function. Option C refers to the relationship between government spending and income, and option D refers to the price of consumer goods and services.

The Consumption Function Is a Plot of The