Advertisements
Advertisements
प्रश्न
Explain MPC and illustrate these through a numerical example.
स्पष्ट करा
संख्यात्मक
Advertisements
उत्तर
Marginal propensity to consume refers to the ratio of change in consumption to change in income.
Symbolically,
MPC(c) = `(DeltaC)/(DeltaY)`
where ΔC refers to change in total consumption and ΔY refers to change in income.
When total income increases from ₹ 1,000 crore to ₹ 1,100 crore, and as a consequence, consumption expenditure increases from ₹ 900 crore to ₹ 980 crore, the MPC will be 0.8.
MPC = `(DeltaC)/(DeltaY)`
= `(980-900)/(1100-1000)`
= `80/100`
= 0.8
The slope of the C curve indicates marginal propensity to consume.
shaalaa.com
या प्रश्नात किंवा उत्तरात काही त्रुटी आहे का?
