Where the Consumption Function Crosses the 45° Line

question 230

Multiple Choice

Where the consumption function crosses the 45° line

• A) consumption expenditure equals saving.
• B) saving is positive.
• C) saving is negative.
• D) consumption expenditure equals disposable income.

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Definitions:

Appliance Manufacturer

A company involved in designing, producing, and selling electrical or mechanical devices for domestic use.

Mutual Fund

An investment program funded by shareholders that trades in diversified holdings and is professionally managed.

Mortgage

A loan used to purchase a property, where the property itself serves as collateral until the loan is paid off.

Investment

The action of allocating resources, usually money, with the expectation of generating an income or profit.