Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Determination of Income and Employment

Question:

Even if income is zero, some consumption still takes place, which is independent of income. This type of consumption is called?

Options:

Autonomous Consumption.

Household Consumption

Induced Consumption.

Dependent Consumption.

Correct Answer:

Autonomous Consumption.

Explanation:

The correct answer is Option (1) → Autonomous Consumption.

Autonomous consumption refers to the minimum level of consumption that occurs even when income is zero. It is independent of income and represents basic necessities like food, shelter, and clothing that people consume regardless of their income level. This is different from induced consumption, which varies directly with income.