What Is the Effect on the Consumption Function of an Increase

question 26

Multiple Choice

What is the effect on the consumption function of an increase in disposable income?

• A)The consumption function shifts upward.
• B)The consumption function shifts downward.
• C)There is movement upward along the consumption function.
• D)There is movement downward along the consumption function.
• E)The consumption function becomes steeper.

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Definitions:

Instrumental Values

Values that are considered a means to an end, guiding how we achieve our terminal values or goals.

Terminal Values

Deeply held beliefs about the ultimate goals of life, such as happiness, success, and peace, that guide an individual's behaviour and life choices.

Long-term Goals

Objectives or plans that are intended to be achieved over an extended period, typically several years or more, focusing on future accomplishments.

Open-mindedness

The willingness to consider new ideas and opinions without preconceived judgments.