Asked by Magen Phillips on May 07, 2024
Verified
When disposable income is 2,000,C + I is
A) 500.
B) 2,000.
C) 2,500.
D) None of the answers are correct.
Disposable Income
The disposable income households have for expenditures and savings, post-income taxation.
C + I
A formula component in macroeconomics representing total private consumption (C) plus total private investment (I).
- Outline the correlation between disposable income, investment, and consumption.
Verified Answer
KG
Kewani GebreslassieMay 09, 2024
Final Answer :
C
Explanation :
Disposable income (DI) is equal to consumption (C) plus investment (I) plus government spending (G) plus net exports (NX), or DI = C + I + G + NX. Since DI is given as 2,000, and we don't have information about G or NX, we can assume they are zero for simplicity. Therefore, C + I = 2,000, and we can't determine the values of C and I separately without further information.
Learning Objectives
- Outline the correlation between disposable income, investment, and consumption.