The relationship between the MPS and the MPC is such that
A) MPC − MPS = 1.
B) MPS/MPC = 1.
C) 1 − MPC = MPS.
D) MPC − 1 = MPS.

Question

Quizplus · Accepted Answer

The MPC represents the proportion of additional income that is spent, while the MPS represents the proportion that is saved. Therefore, if a certain proportion of income is saved (MPS), then the remaining proportion must be spent (1-MPS). This remaining proportion is the MPC. So, 1-MPC=MPS.

The Relationship Between the MPS and the MPC Is Such