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22 June, 05:35

At which income level does consumption equal income in table 9.1?

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  1. 22 June, 05:41
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    Consumption equals disposable income when APC is equal to 1. Given the above consumption function of C = $50 + 0.8YD, and since the APC equals 1, then YD = C and you can substitute YD for C in the equation.
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