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Personal disposable income is
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- always equal to personal income
- always more than personal income
- equal to personal income minus indirect taxes
- equal to personal income minus direct taxes
- always equal to personal income
Correct Option: D
Disposable income is total personal income minus personal current taxes. In national accounts definitions, personal income, minus personal current taxes equals disposable personal income. Subtracting personal outlays (which includes the major category of personal (or, private) consumption expenditure) yields personal (or, private) savings.
