The Figure Given Below Represents the Consumption Function of a Country

question 63

Multiple Choice

The figure given below represents the consumption function of a country.
Figure 9.3

-Refer to Figure 9.3. If the marginal propensity to consume is equal to 0.3, then:

• A) autonomous consumption would decrease.
• B) the total amount of dissaving would increase.
• C) consumption spending would equal disposable income at an income level greater than $400.
• D) consumption spending would equal disposable income at an income level less than $400.
• E) consumption spending would equal disposable income at the same income level of $400.

---

Definitions:

Nonstock Companies

Companies organized not to issue stock to the public, often structured to provide a service or benefit without profit motive.

Privately Held

A company ownership structure where its shares are not traded on public stock exchanges and are instead owned by a smaller number of private investors.

Foreign Corporation

A corporation that is incorporated under the laws of a country different from the country where it conducts its operations.

Incorporated

A legal process used to form a corporate entity or company which is recognized as a legal person under the law.