The MPC + MPS must always equal
A)The slope of the consumption function.
B)1.
C)The APC.
D)0

Question

Quizplus · Accepted Answer

The MPC (marginal propensity to consume) represents the change in consumption due to a one unit change in income, while the MPS (marginal propensity to save) represents the change in savings due to a one unit change in income. Since income can either be consumed or saved, the sum of MPC and MPS must equal 1 (or 100% in percentage terms). So, option B is correct.

The MPC + MPS Must Always Equal