If an individual's income increases from $500 to $700 and their spending increases by $120, what is the marginal propensity to consume?

Name: If an individual's income increases from $500 to $700 and their spending increases by $120, what is the marginal propensity to consume?
Brand: Quizplus
Rating: 5.0 (52 reviews)

Question

Quizplus · Accepted Answer

The change in income is $200 ($700 - $500) and the change in spending is $120. 
Marginal Propensity to Consume (MPC) = Change in spending / Change in income 
MPC = $120/$200 = 0.6

If an Individual's Income Increases from $500 to $700 and Their