An Increase in Consumer Confidence Will

question 77

Multiple Choice

An increase in consumer confidence will

• A) not change autonomous consumption and rotate the consumption function upward.
• B) not change autonomous consumption and rotate the consumption function downward.
• C) increase autonomous consumption and shift the consumption function upward.
• D) decrease autonomous consumption and shift the consumption function downward.

---

Definitions:

Imperfectly Competitive

Describes a market structure where firms have some degree of market power and can influence prices, unlike in perfect competition.

Purely Competitive

A market structure characterized by a large number of small firms, homogenous products, and easy entry and exit, leading to firms being price takers.

Resource Demand Curve

A graphical representation showing the relationship between the price of a resource and the quantity of the resource demanded by employers.

Marginal Product

The additional output that results from using one more unit of a specific input, holding all other inputs constant.