As the MPC decreases, the government spending multiplier increases.

Name: As the MPC decreases, the government spending multiplier increases.
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Quizplus · Accepted Answer

The government spending multiplier is inversely related to the marginal propensity to save (MPS), not the marginal propensity to consume (MPC). Since MPS = 1 - MPC, a decrease in MPC actually means an increase in MPS, which would decrease the government spending multiplier.

As the MPC Decreases, the Government Spending Multiplier Increases