Consumption occurs when income is exchanged for goods or services

income tax is greater than income

disposable income is spent on consumer goods and services

taxes are paid to state and federal governments

The correct answer is when income is exchanged for goods or services.

Explanation:

When we earn income, a portion of it goes to savings, and the balance income is called the disposable income. This disposable income can be used in various ways. You can invest it in income generating assets such as stocks, real estate, or you can exchange that for goods and services which is called the consumption.

Generally, the rate of consumption grows when the income grows.

Answer: the anwser is c

disposable income is spent on consumer goods and services.