The fraction of an increase in income that is saved is referred to as the _____.
A)marginal propensity to save
B)average propensity to save
C)marginal propensity to consume
D)average propensity to consume
E)saving-consumption ratio

Question

Quizplus · Accepted Answer

The marginal propensity to save is a term used in economics to describe the amount by which the aggregate amount of saving changes with respect to change in income. It is calculated as the ratio of change in savings to change in income.

The Fraction of an Increase in Income That Is Saved