If the autonomous consumption is 250 and if Y= C = 1000, then the marginal propensity to save is:
A) 0.80.
B) 0.75.
C) 0.50.
D) 0.25.

Name: If the autonomous consumption is 250 and if Y= C = 1000, then the marginal propensity to save is: A) 0.80. B) 0.75. C) 0.50. D) 0.25.
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Quizplus · Accepted Answer

The marginal propensity to consume (MPC) is calculated as (C - autonomous consumption) / Y. Here, MPC = (1000 - 250) / 1000 = 0.75. Since MPC + MPS = 1, the marginal propensity to save (MPS) is 1 - 0.75 = 0.25.

If the Autonomous Consumption Is 250 and If Y= C