On a Graph of the Consumption Function, Where the Consumption

question 108

Multiple Choice

On a graph of the consumption function, where the consumption function crosses the 45 degree line,

• A) disposable income is zero.
• B) the maximum level of disposable income is earned.
• C) there is no saving and no dissaving.
• D) there are no tax payments.
• E) induced consumption equals zero.

---

Definitions:

Intuition

The ability to understand something instinctively, without the need for conscious reasoning.

Reinforcement

Any event that follows a response and strengthens or increases the probability that the response will be repeated.

Geopolitical Position

The strategic importance of a country or region as influenced by its geographic location and political factors in relation to other spaces.

Economic Development

The process by which a nation improves the economic, political, and social well-being of its people.