Question
Your marginal propensity to consume is equal to the change in _____________ divided by the change in _____________.
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The larger is the marginal propensity to consume, the larger will be the multiplier.
What is the marginal propensity to consume, and how is it related to the marginal propensity to import?
Marginal Propensity to Consume The consumption function of the U.S. economy from 1929 to 1941 is $$C(x)=0.712 x+95.05$$ where $C(x)$ is the personal consumption expenditure and $x$ is the personal income, both measured in billions of dollars. Find the rate of change of consumption with respect to income, $d C / d x .$ This quantity is called the marginal propensity to consume.
Differentiation
Marginal Functions in Economics
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