If the marginal propensity to consume is 0.75, the marginal propensity to save is
A)0.25.
B)0.5.
C)0.75.
D)1.
E)3.

Name: If the marginal propensity to consume is 0.75, the marginal propensity to save is A)0.25. B)0.5. C)0.75. D)1. E)3.
Brand: Quizplus
Rating: 4.9 (38 reviews)

Question

Quizplus · Accepted Answer

The marginal propensity to consume (MPC) and the marginal propensity to save (MPS) always add up to 1. Therefore, if the MPC is 0.75, the MPS must be 0.25 (1 minus 0.75).

If the Marginal Propensity to Consume Is 0