The marginal propensity to consume (MPC) is computed as the change in consumption divided by the change in:
A) GDP.
B) income.
C) saving.
D) none of the above.

Question

Quizplus · Accepted Answer

The MPC is calculated as the change in consumption divided by the change in income. It represents the fraction of each additional dollar of income that is spent on consumption, thereby measuring the sensitivity of consumption to changes in income.

The Marginal Propensity to Consume (MPC) Is Computed as the Change