If a $2,000 increase in income leads to a $1,5000 increase in consumption expenditures, then the...

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If a $2,000 increase in income leads to a $1,5000 increase in consumption expenditures, then the...

If a $2,000 increase in income leads to a $1,5000 increase in consumption expenditures, then the marginal propensity to consume is what? Show the work

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Answer 1

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marginal propensity to consume =change in consumption /change in income

=1500/2000

=3/4

=0.75

the marginal propensity to consume is 0.75

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Answer 2

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