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Economics miscellaneous

  1. Consumption function expresses the relationship between consumption and
    1. savings
    2. income

    3. investment
    4. price
Correct Option: B

The consumption function is a mathematical formula laid out by famed economist John Maynard Keynes. The formula was designed to show the relationship between real disposable income and consumer spending, the latter variable being what Keynes considered the most important determinant of short-term demand in an economy.



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