Question

Consider the consumption function below and answer the questions that follow: C= 40 + 0.25YD

1.1. Sketch the above function on a graph

Answer 1

QUESTION: Consider the consumption function below and answer the questions that follow: $C = 40 + 0.25YD$ .

ANSWER: GRAPH OF THE FUNCTION, $C = 40 + 0.25YD$

C is Consumption which is the function of

Autonomous expenditure = 40

Marginal propensity to consume or MPC = 0.25 and

Disposable Income (YD)

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