Marginal propensity to save is 0.3. Calculate MPC

Discussion in 'Calculator Requests' started by math_celebrity, Jun 12, 2019.

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  1. math_celebrity

    math_celebrity Administrator Staff Member

    Marginal propensity to save is 0.3. Calculate MPC.

    MPC is Marginal Propensity to Consume. And MPS is Marginan Propensity to Save.

    The relational equation between the two is:
    MPC + MPS = 1

    To get MPC, we have:
    MPC = 1 - MPS

    The problem gives us MPS = 0.3, so plug it into this modified MPC equation:
    MPC = 1 - 0.3
    MPC = 0.7
     
    math_celebrity, Jun 12, 2019
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