Increases in the marginal propensity to consume will

Question

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An increase in the marginal propensity to consume (MPC) means that consumers are more likely to spend a higher proportion of their additional income on consumption goods and services. This, in turn, leads to an increase in aggregate demand, which is the total demand for goods and services in an economy. The multiplier effect refers to the fact that an initial increase in spending will lead to a larger increase in total output. Therefore, an increase in the MPC will increase the multiplier.

Increases in the Marginal Propensity to Consume Will