Exhibit 9-9
-The larger the marginal propensity to save,other things constant,
A)the larger the marginal propensity to consume
B)the larger the multiplier
C)the steeper the consumption function
D)the flatter the consumption function
E)the flatter the saving function

Question

Exhibit 9-9 
-The larger the marginal propensity to save,other things constant,
A)the larger the marginal propensity to consume 
B)the larger the multiplier 
C)the steeper the consumption function 
D)the flatter the consumption function 
E)the flatter the saving function

Quizplus · Accepted Answer

The marginal propensity to save (MPS) and the marginal propensity to consume (MPC) are complementary; as MPS increases, MPC decreases, leading to a flatter consumption function.

Exhibit 9-9 -The Larger the Marginal Propensity to Save,other Things Constant