Exploring Macroeconomics
8th Edition
ISBN: 9781544337722
Author: Robert L. Sexton
Publisher: SAGE Publications, Inc
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Chapter 15, Problem 7P
To determine
To explain:
The effect on the consumption function if there is an increase in the marginal propensity to save.
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- In an economy investment is increased by 1800 billion calculate the change in total income if the marginal propensity to save is 0.31?arrow_forwardWhat is individual Marginal Propensity to Consume and Marginal Propensity to Save? please provide an example for each.arrow_forwardThe value of marginal propensity to consume is 0.44 Calculate the value of Marginal propensity to save?arrow_forward
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- The table below provides Income and consumption Data in billions of dollars. Answer questions 21-24 based on it.Disposable Consumption SavingsIncome100 80 --------200 150 ---------What is the marginal propensity to save for this economy? a. 0.75 b. 0.50 c. 0.3 d. cannot be determinedarrow_forwardHow to calculate mpc?arrow_forward| Assume in country Y, the average marginal propensity to save is 0.2. When the aggregate income is zero, consum- ers spend 50 to consume. Derive the saving function and consumption function for this country. What happens to consumption when the propensity to save decreases to 0.1? Explain your answer and show this on the graph.arrow_forward
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