Question

Which of the following is a determinant of autonomous consumption?                A. The price level.     B....

Which of the following is a determinant of autonomous consumption?

              

A.

The price level.    
B.

Taxes.    
C.

The availability of credit.    
D.

All of the above.
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Homework Answers

Answer #1

Answer....... c ( The availability of credit)

Explanation — Autonomous consumption is the minimum consumption of the society which it must incurs for survival, It doesn't depend on the level of disposable income of the society, the major determinants of autonomous consumption are wealth, future expectations, interest rate, availability of credit etc.

Taxes change disposable income which can't affect autonomous consumption while a change in the price level affects real income of buyers which again can't affect the autonomous consumption.

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