Question

How does the consumption curve begin and move as income changes?

विकल्प

• It starts above the origin and slopes upward.

• It starts at the origin and slopes downward.

• It starts below the origin and is horizontal.

• It starts on the 45° line and slopes downward.

Answer 1

Autonomous consumption makes the consumption curve start above the origin. Induced consumption causes the curve to slope upward as income rises.