Using Real GDP on the Horizontal Axis Instead of Real

Multiple Choice

Using real GDP on the horizontal axis instead of real disposable income implies that a marginal propensity to consume 0.8 generates for every additional $100 of real GDP

A) $80 of additional real disposable income.
B) $18 of additional saving.
C) $80 of additional consumption spending.
D) $20 of additional saving and taxes.