Refer to the consumption schedules shown in the above diagram for economies 1, 2, 3, and 4.The MPC is greatest in economy:
A)1
B)2
C)3

Name: Refer to the consumption schedules shown in the above diagram for economies 1, 2, 3, and 4.The MPC is greatest in economy: A)1 B)2 C)3
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Question

Refer to the consumption schedules shown in the above diagram for economies 1, 2, 3, and 4.The MPC is greatest in economy:
A)1 
B)2 
C)3

Quizplus · Accepted Answer

The MPC is the slope of the consumption schedule, and the steeper the slope, the greater the MPC. In economy 1, the consumption schedule has the steepest slope, indicating the highest MPC. Therefore, the correct choice is A) 1.

Refer to the Consumption Schedules Shown in the Above Diagram