The marginal propensity to consume is 0.5, aggregate autonomous consumption is $10,000, and aggregate disposable income is $40,000. If disposable income is expected to increase, the aggregate consumption function might take the form of:

D) C= 12,000 + (40,000 x 0.5)

Explanation:

the current aggregate consumption function is C = 10,000 + (40,000 x 0.5)

if the aggregate autonomous consumption increases, then the function would be:

So the only possible option is D

u = 30

continuing your method

= +

subtract from both sides

= - thus

= -

= ⇒ u = 30