BAR0803-02 MACRO

Define marginal propensity to save (MPS), and marginal propensity to consume (MPC).

  1. MPS. Change in savings as a result of a change in disposable income.
  2. MPC. Change in consumption as a result of a change in disposable income.
  3. MPS + MPC = 1.
May 18, 2018 | |