Question #65263
If Mary James' disposable income increases from $32,000 to $33,000 and her level of saving increases from $200 to $325, what is her MPC?
Expert's answer
Mary James' disposable income increased by $ 33000-$32000=$1000 and her level of saving increased by $325-$200=$125, then MPS=$125/$1000= 0.125. So, MPC=1-MPS=0.875.
