Exhibit 8-1 Disposable income and consumption data
Disposable Income(Y)
Consumption(C)
       0
   500
1,000
1,400
2,000
2,200
3,000
2,900
4,000
3,500
5,000
4,000

In Exhibit 8-1, when disposable income is increased from $2,000 to $3,000 to $4,000, the marginal propensity to consume

A. remains constant.
B. increases from 0.6 to 0.7.
C. decreases from 0.8 to 0.7.
D. decreases from 0.7 to 0.6.

Answer: D