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Question
Calculate the marginal propensity to save (MPS) when total savings increase from ₹140 crore to ₹160 crore as a result of an increase in income from ₹600 crore to ₹700 crore.
Numerical
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Solution
MPS = `"ΔS"/"ΔY"`
= `(160 − 140)/(700 − 600)`
= `20/100`
= 0.2
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