The marginal propensity to consume (MPC) is defined as:
A)the additional consumption that results from one dollar increase in disposable income.
B)the fraction of total disposable income that households spend on consumption.
C)the fraction of total disposable income that households save.
D)the additional disposable income households earn in a given period.

Question

The marginal propensity to consume (MPC) is defined as:
A)​the additional consumption that results from one dollar increase in disposable income.
B)​the fraction of total disposable income that households spend on consumption.
C)​the fraction of total disposable income that households save.
D)​the additional disposable income households earn in a given period.

Quizplus · Accepted Answer

The definition of MPC is the additional consumption that results from one dollar increase in disposable income.

The Marginal Propensity to Consume (MPC) Is Defined As