1) Assume aggregate consumer spending equals $5,000 when aggregate disposable income is zero, and when disposable income increases from $300 to $400, consumer spending increases by $70. What is the equation for the aggregate consumption function? C = _____ + ______

2) Use the data in the following table. Assume that this economy has only two goods produced, oranges and computers, and 2010 is the base year. The consumption basket of a typical consumer is 3 oranges and 1 computer.

2010 2011 Quantity of oranges(billions 4, 000 4, 500 Price of oranges $2.50 $3.00 Quantity of computers ( billions 1, 200 1, 600 Price of computers $3.50 $2.80