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Answer to Question #249227 in Macroeconomics for Biba
Question #249227
6. â Along the consumption function, income changes more than consumption.â What does this imply for the MPC and MPS?
Expert's answer
The marginal propensity to consume (MPC) measures the change in consumption as a result of a change in income. Similarly, MPS refers to a change in savings as a result of a change in a person's income.
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