Suppose that if your income increases by $100, all households in Normalia increase their expenses by $50.

Instructions: Round your answers to one decimal place.

The MPC in Normalia is:

MPS in Normalia is:

b. Assume that the MPC in South Pangea is 0.9.

Instructions: Enter your answer as a whole number.

If a South Pangean household earns an extra $100, how much will their expenses increase?

Answer rating: 100% (QA)

To determine the MPC Marginal Propensity to Consume and MPS Marginal Propensit... View the full answer