Disposable Income: Disposable income is the amount of money that individuals have available to spend or save after taxes and other mandatory deductions are taken out. It is directly related to %ΔI because any changes in disposable income will affect the percentage change in overall income.
Personal Savings Rate: The personal savings rate is the percentage of disposable income that individuals save rather than spend. It is indirectly related to %ΔI because if people save more, their spending may decrease, resulting in a smaller percentage change in overall income.
Aggregate Demand: Aggregate demand represents the total amount of goods and services demanded by all sectors of an economy at different price levels. Changes in %ΔI can impact aggregate demand since higher incomes often lead to increased consumer spending, which drives up demand for goods and services.