Assume disposable income increases by 10000 and consumption increases by 8500, what is the value of MPC
A)0.85
B)0.9
C)0.95
D)0.5
E)0.15

Name: Assume disposable income increases by 10000 and consumption increases by 8500, what is the value of MPC A)0.85 B)0.9 C)0.95 D)0.5 E)0.15
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Question

Quizplus · Accepted Answer

The Marginal Propensity to Consume (MPC) is calculated by dividing the change in consumption by the change in disposable income. Here, MPC = 8500 / 10000 = 0.85.

Assume Disposable Income Increases by 10000 and Consumption Increases by 8500