If an Economist Wants to Make a Prediction About the Effects

Multiple Choice

If an economist wants to make a prediction about the effects of a change in disposable income on the change in consumption spending based on historical data, she must assume that

A) the future will closely resemble the past.
B) consumption and disposable income will be negatively related.
C) the consumption function will have a downward slope.
D) as disposable income increases, consumer spending will remain constant.