Question: 6. Suppose that C = a + bY, where C = consumption, a = consumption at zero income, b = slope, and Y = income.

6. Suppose that C = a + bY, where C = consumption, a = consumption at zero income, b = slope, and Y = income. LO1.8

a. Are C and Y positively related or are they negatively related?

b. If graphed, would the curve for this equation slope upward or slope downward?

c. Are the variables C and Y inversely related or directly related?

d. What is the value of C if a = 10, b = 0.50, and Y = 200?

e. What is the value of Y if C = 100, a = 10, and b = 0.25?

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