The Figure Given Below Shows the Consumption Function of a Household

question 66

Multiple Choice

The figure given below shows the consumption function of a household.
Figure 9.2

-In Figure 9.2, a decrease in disposable income would be illustrated by:

• A) shifting the whole consumption function upward.
• B) shifting the whole consumption function downward.
• C) moving along the consumption function to the left.
• D) moving along the consumption function to the right.
• E) moving from point A to point D.

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Definitions:

Socio-Economic Groups

Categorizations of people based on their social and economic factors, such as income, occupation, and education.

Law Of Small Numbers

A mental inclination that causes individuals to form wide-reaching conclusions based on limited data samples.

Gambler's Fallacy

The erroneous belief that if an event occurs more frequently than normal during a given period, it will happen less frequently in the future, or vice versa.

Midterms

Examinations given in the middle of an academic term to assess students' understanding of the course material up to that point.