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Aggregate Demand, Consumption & Saving · Question 13 of 60

The graph shows a consumption function.

Question 13

MediumOriginal question

The graph shows a consumption function. At point K, how much is saved?

A consumption line C = 40 + 0.75Y starting at ₹40 crore on the vertical axis, and a dashed 45° line from the origin. They cross at B, where income and consumption are both ₹160 crore. At K, income is ₹400 crore and consumption ₹340 crore.
Options for question 13

Show the answer and explanation
CorrectNot quiteAnswer B

Correct answer: B

Explanation

  1. At K, income is ₹400 crore and consumption ₹340 crore.

  2. Saving = Y − C = 400 − 340 = ₹60 crore.

Concept
Saving from the consumption line
Typical time
70 s
Your time
—
The rule this testsThe consumption function
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