Question

Consumption demand depends upon the -------​

Answer 1

Answer:

Consumption demand depends upon the Total Disposable Income

Explanation:

Everybody needs income to purchase goods and services. Higher the level of income, higher will be the capacity to buy the goods and services. So for an individual, the total amount of goods and services to be purchased depends on the available disposable income.

Similarly, for an economy as a whole, it can be said that the aggregate consumption of all depends on the total income generated in the economy. When the total income of the economy increases total consumption of the economy will also increase. When we refer to income, we normally mean disposable income. Disposable income is that part of total income which is available for consumption and saving.

Disposable income is defined as the income remained after payment of taxes and fines. If tax payment in high, disposable income will be lower and vice versa.

Hope will be helpful ☺️