Autonomous Consumption Is 50

question 21

Multiple Choice

Autonomous consumption is 50.With every increase of one dollar in disposable income, consumption increases 60 cents.The marginal tax rate is 10 percent.The equation of the consumption function is

• A)C = 50 + 0.54YD.
• B)C = 50 + 0.06Y.
• C)C = 50 + 0.54Y.
• D)C = 50 + 0.6Y.
• E)C = 50 + 0.5YD.

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Definitions:

Promissory Notes

Written promises to pay a specified sum of money to a specified person at a specified time.

Compounded Monthly

Interest calculation method where interest is added to the principal balance monthly, affecting future interest computations.

25 Years

A term often referring to the duration of a loan or mortgage, indicating the time over which repayments are to be made.

Interest

Interest is the charge for borrowing money, typically expressed as an annual percentage rate of the principal.