The slope of the expenditure line is dependent upon:
A) the marginal propensity to consume.
B) the marginal efficiency of capital.
C) how far the government decides to increase autonomous expenditure.
D) the slope of the 45 degree line.

Question

Quizplus · Accepted Answer

The slope of the expenditure line is determined by the marginal propensity to consume, which is the fraction of additional income that is spent. Higher marginal propensities to consume result in steeper expenditure lines.

The Slope of the Expenditure Line Is Dependent Upon