Assume that autonomous consumption is $1 comma 769 billion and disposable income is $10 comma 100 billion. Using the consumption function, calculate consumption expenditure if an increase of $1,000 in disposable income leads to an increase of $610 in consumption expenditure. Consumption expenditure is $ nothing billion. (Enter your response as a whole numbe

Consumption expenditure is $7,930 billion

Explanation:

Consumption function: C = A + MD

where,

C is the consumer spending,

A is the autonomous consumption

M is the marginal propensity to consume

D is the disposable income

MPC = Increase in consumption : Increase in income

= $610 : $1000

= 0.61

Therefore,

C = 1,769 + 0.61 (10,100)

= 1,769 + 6,161

= $7,930

Therefore, the Consumption expenditure is $7,930 billion.