Identify the Correct Statement with Respect to Consumption and Saving

question 24

Multiple Choice

Identify the correct statement with respect to consumption and saving function.

• A) Both the consumption function and the saving function have negative slopes.
• B) As disposable income declines, consumption and saving increase.
• C) The consumption function has a negative slope while the saving function has a positive slope.
• D) As disposable income rises, consumption and saving increases.
• E) The consumption function has a positive slope while the saving function has a negative slope.

---

Definitions:

Impunity

Exemption from punishment or loss or escape from fines in cases where actions could typically result in such consequences.

Joint Tenancy

is a form of property ownership where two or more parties hold equal ownership interests, and the survivor(s) inherit any deceased's share.

Surviving Owner

refers to an individual who co-owned property or assets with another and retains ownership after the other’s death, often in joint tenancy agreements.

Fixed-term Tenancy

A leasing agreement for a specific period, providing stability for both tenant and landlord but limiting flexibility.