Given the Keynesian consumption function, how would a cut in income tax rates affect consumption? Explain your answer.

A cut in income tax rates would be one part of a classic
Keynesian fiscal policy approach to combatting a
recession.

Keynesians emphasize the importance of aggregate
demand in macroeconomics.  That means that, to them, an income tax cut is important
because it will increase aggregate demand.

It will do this
by increasing consumption.  A tax cut will give people a higher disposable income.  By
definition, looking at the equation for the consumption function, an increase in
disposable income makes for an increase in
consumption.

This is because C = a + c Yd
where

a is autonomous spending, c is mpc and Yd is
discretionary income.

If Yd goes up and everything else is
constant, C (consumption) must go up as well.