Here Is a Consumption Function: C = C₀ + MPC(Y_d)

question 131

Multiple Choice

Here is a consumption function: C = C₀ + MPC(Y_d) .If MPC is 0.85,then we know that

• A) as Y_d rises by $1,Co rises by $0.85.
• B) as Y_d rises by $1,C rises by $0.85.
• C) Y_d rises by $0.85.
• D) as C₀ rises by $0.85,Y_d rises by $1.

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