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Define MPC and MPS .Given the consumption function: C=100+0.75 Yd , where Y=2000 and Tax rate=5% (i) Compute disposal income( Yd ), savings(S) and consumption(C)
Define MPC and MPS .Given the consumption function: C=100+0.75 Yd , where Y=2000 and Tax rate=5% (i) Compute disposal income( Yd ), savings(S) and consumption(C) (ii) Compute APC and APS. Show that APC+APS=1 (iii) Prove that, MPC+MPS =1
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