Calculate the marginal propensity to consume. At what level of disposable income will saving be zero? If

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Calculate the marginal propensity to consume. At what level of disposable income will saving be zero? If expected future income increases, in which direction will the consumption function change?


The table shows disposable income and consumption expenditure in an economy. Use the table to work Problem.

Disposable Consumption expenditure (billions of dollars) 350 income 200 400 500 600 650 800 800 1,000 950

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Foundations of Macroeconomics

ISBN: 978-0134492001

8th edition

Authors: Robin Bade, Michael Parkin

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