When Graphing the Consumption Function, What Purpose Is Served by the 45-Degree

question 106

Multiple Choice

When graphing the consumption function, what purpose is served by the 45-degree line?

• A) It identifies all the points at which saving and consumption spending are equal.
• B) It identifies all the points at which real disposable income and planned real consumption spending are equal.
• C) It identifies all the points at which real planned investment expenditure and real autonomous consumption spending are equal.
• D) It identifies all the points where real dissaving and saving are equal.

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Definitions:

Conglomeration

A collection or combination of various items, businesses, or entities grouped into a single entity or organization.

Seagram's

A large and historical brand known for its production of alcoholic beverages, notably whiskey, and involvement in the entertainment and beverages industry.

Universal Records

A global music corporation that manages recordings and copyrights of artists.

Leisure

Free time not taken up by work, duties, or responsibilities, which can be used for relaxation, hobbies, or personal enjoyment.