The marginal propensity to consume is

Economics

JAMB 2023

A. Options A, B and C
B. ΔC/ΔY
C. The slope of the consumption function
D. Coefficient c in the equation C = C + cYd

NECO June/July 2024 - Get offline past questions & answers - Download objective & theory, all in one app 48789

Project Topics and Materials, Post-UTME past questions - Download now or upload yours to get paid

Correct Answer: Option A

Explanation

The marginal propensity to consume is the ratio of change in consumption to change in income. It is mathematically represented as: MPC = ∆C/∆Y and also the consumption function is represented as C = a +bYd ( C = C + cYd) where the b(c) is the MPC which ranges between 0 and 1. The slope of the consumption function is b or MPC

Previous Next

Go back to Econs classroom

Report an Error Ask A Question Download App