REASONING AND ANALYSIS Research Paper Example | Topics and Well Written Essays - 750 words

REASONING AND ANALYSIS - Research Paper Example The income transfer does not necessary need to be worked for but is issued on free terms regardless of merit. Consumption can be depicted by what a person eats, what person dresses, the house he or she lives in and the luxuries in which that person can afford. The price of a good can be considered the cost of buying a set good; on the other hand, value can be described as the satisfaction one derives from consuming a particular commodity. Therefore, value is the most important aspect to a consumer. The main argument that constitutes the claim is that income affects inherent consumption. It is guaranteed that as income increases, consumption also increases. Thus, the two are directly proportional. However, it can be noted that income affects consumption but not the other way round. Consumption cannot affect income since it is consumption that is dependent on income. In another perspective, it is noted that income also affects a person’s relations. As income increases, the relationship of a person with other people tends to be directed to people of the same caliber. A person who is rich can be noted to have more friends who are related to his or her status. Also, it is noted that rich people are less superstitious and noted to be les s religious. Therefore, income affects relations of the individual (Miller, 1998). In life, as someone increases his wealth, his surroundings tend to change. An instance is the theory put forward by Keynes. The theory is justified by different research papers. The Keynesian theory, the consumption of a person is directly affected by the income. The income tends to trigger other tastes and preferences that were not significant to a person in a former status. Therefore, a person tends to develop a taste for luxurious commodities depending on the level of income. In addition, as the price of luxurious goods increases, the value of the good also increases. Income also affects the consumption of alcohol