The Slope of the Consumption Function Is

question 427

Multiple Choice

The slope of the consumption function is

• A) less than 1.
• B) 1.
• C) greater than 1.
• D) negative.

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Definitions:

Essential Consumption

The purchase and use of goods and services that are considered necessary for basic living and well-being.

Marginal Utility

The additional satisfaction or utility that a consumer gains from consuming one more unit of a good or service.

Total Utility

The total satisfaction received from consuming a particular quantity of goods or services.

Price Elasticity

A calculation of the extent to which the desired quantity of a good changes following a price modification.