According to the table, the value of the marginal propensity to consume is
$$\begin{array} { l c }
\hline \text { Income } & \text { Consumption } \
\hline \$ 1,000 & \$ 900 \
\$ 2,000 & \$ 1,700 \
\$ 3,000 & \$ 2,500 \
\$ 4,000 & \$ 3,300 \
\$ 5,000 & \$ 4,100 \
\hline
\end{array}$$

Question

According to the table, the value of the marginal propensity to consume is
$$\begin{array} { l c } 
\hline \text { Income } & \text { Consumption } \
\hline \$ 1,000 & \$ 900 \
\$ 2,000 & \$ 1,700 \
\$ 3,000 & \$ 2,500 \
\$ 4,000 & \$ 3,300 \
\$ 5,000 & \$ 4,100 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The marginal propensity to consume (MPC) is calculated as the change in consumption divided by the change in income. From the table, the consumption increases by \$800 (\$1700 - \$900) when income increases by \$1000 (\$2000 - \$1000), so MPC = \$800 / \$1000 = 0.8.

According to the Table, the Value of the Marginal Propensity