The change in desired consumption divided by the change in disposable income that brought it about is called the
A)average propensity to consume.
B)average propensity not to consume.
C)consumption function.
D)marginal propensity to consume.
E)marginal propensity not to spend.

Question

Quizplus · Accepted Answer

The change in desired consumption divided by the change in disposable income that brought it about is defined as the marginal propensity to consume (MPC).

The Change in Desired Consumption Divided by the Change in Disposable