Option 1 -> C represents total consumption, not autonomous consumption.
Option 2 -> cY represents induced consumption (consumption dependent on income).
Option 3 -> C̄ represents autonomous consumption (consumption independent of income).
Option 4 -> Y represents income, not autonomous consumption.
Hence, Option 3: C̄ -> Autonomous consumption (C̄) is the level of consumption that occurs even when income (Y) is zero. It represents the minimum consumption expenditure required for basic necessities, which is independent of the current income level. In the consumption function C = C̄ + cY, C̄ is a constant term that shifts the entire consumption function vertically, while cY represents the income-dependent portion of consumption. -> correct