The marginal propensity to consume is equal to
A) the desired amount of consumption expenditure as a proportion of disposable income.
B) the change in consumption expenditure from a change in disposable income.
C) what people spend out of total disposable income.
D) the average, after-tax consumption amount.

Question

Quizplus · Accepted Answer

The marginal propensity to consume is the change in consumption expenditure that results from a change in disposable income. It is a measure of how much of each additional dollar of income is spent on consumption.

The Marginal Propensity to Consume Is Equal to