The MPC is equal to the
A) change in consumption expenditure divided by the change in disposable income that brought it about.
B) change in consumption expenditure divided by the total disposable income that brought it about.
C) level of consumption expenditure divided by the level of total disposable income that brought it about.
D) level of consumption divided by the change in disposable income that brought it about.
E) change in disposable income divided by the change in consumption expenditure.

Question

Quizplus · Accepted Answer

The MPC (marginal propensity to consume) is the change in consumption expenditure divided by the change in disposable income that brought it about. In other words, it measures how much of each additional unit of income is spent on consumption.

The MPC Is Equal to the