Disposable income is:
Correct answer: C. Personal income remaining after income taxes
- A. The same as personal income
- B. Income that is used only for consumption
- C. Personal income remaining after income taxes
- D. Exclusive of social security payments or welfareDownload Interactive Maps
Explanation
Disposable income is the amount households can spend or save after personal income taxes are deducted from personal income. It is not limited to consumption because some of it may be saved.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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