On Consumption Function

Abstract

Consumption function refers to the relationship between consumption and income. The formula for long term consumption function is C=C_0+bY.Consumption function and saving function are complementary functions to each other.In China,the end consumption takes up a smaller part in the national GDP.The low end consumption rate and low consumption rate for residents in cities and towns are the key factors which restrict the economic development in China.Measures should be taken to constantly improve the consumption rate,and expand consumption needs,so as to promote a faster growing economy.