The Positive Slope of the Consumption Function Indicates That

question 48

Multiple Choice

The positive slope of the consumption function indicates that

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

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Definitions:

Employee Salaries And Wages

Compensation paid to employees for their services, including both fixed salaries and hourly wages.

Planning Budget

A planning budget is a financial plan that estimates the revenue and expenses for a specific period, typically used as a guide for spending and saving.

Revenue

The total income generated by a business from its normal business operations, including sales of goods and services.

Planning Budget

A budget formulated at the beginning of the budgeting period that is based on planned operations and outputs.