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How would an increase in each of the following affect the consumption function

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3 votes
I had that same exact question on my test, and here are the answers to the A B C D
a. negative, high tax, low consumption.
b. negative, high interest rate, low consumption.
c.positive, high confidence, high consumption.
d. negative, high price, low consumption.
The saving function= Income - Consumption. You do the math. High consumption, low saving.

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User Chekmare
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