Answer the Question on the Basis of the Following Data

question 30

Multiple Choice

Answer the question on the basis of the following data: $\begin{array}{cc}\underline{\text { After-Tax Income} } &\underline{ \text { Consumption }} \\\$ 1,000 & \$ 900 \\2,000 & 1,800 \\3,000 & 2,700 \\4,000 & 3,600 \\5,000 & 4,500\end{array}$ The data indicate that:

• A) consumers spend 80 percent of their after-tax incomes.
• B) consumers spend 90 percent of their after-tax incomes.
• C) a tax reduction will reduce consumption.
• D) the relationship between consumption and after-tax income is random.

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