An increase in consumer spending based on an increase in income is reflected by
A) an upward rotation of the consumption function.
B) a downward shift in the consumption function.
C) a movement up along the consumption function.
D) an increase in the MPC.
C
You might also like to view...
In the above figure, the economy is at point a on the initial supply of loanable funds curve SLF0. What happens if disposable income decreases?
A) Nothing; the economy would remain at point a. B) There would be a movement to a point such as b on supply of loanable funds curve SLF0. C) The supply of loanable funds curve would shift rightward to a curve such as SLF2. D) The supply of loanable funds curve would shift leftward to a curve such as SLF1.
When we say that economic fluctuations are "irregular and unpredictable," we mean that
a. the relationship between output and unemployment is erratic and difficult to characterize. b. when one macroeconomic variable that measures income or spending is falling, other macroeconomic variables that measure income or spending are likely to be rising. c. recessions do not occur at regular intervals. d. All of the above are correct.