Ask Question
BusinessBusiness
24 November, 22:58

if Dawn's disposable income increases from $30,000 to $35,000 what is his marginal propensity to consume if he spends $4,000 of the increase on consumer products?

+5
Answers (1)
  1. 24 November, 23:11
    0
    Marginal Propensity to Consume = 0.8

    Explanation:

    Marginal propensity to consume (MPC) exhibits consumer's spending behavior as to what percentage of extra dollar is spent from extra dollar of income.

    MPC is calculated as Increase in consumption divided by increase in income.

    MPC: Increase in consumption / increase in income: 4,000 / 5,000

    MPC = 0.8
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “if Dawn's disposable income increases from $30,000 to $35,000 what is his marginal propensity to consume if he spends $4,000 of the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
In a recent year Bonita Industries had net income of $130000, interest expense of $50000, and income tax expense of $21000. What was Bonita Industries's times interest earned for the year? a. 2.60 b. 4.02 c. 3.60 d. 3.02
Answers (1)
Presented below are two independent situations. 1. On January 1, 2014, Simon Company issued $200,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1, October 1, and January 1.2.
Answers (1)
How many states in the United States have abolished the death penalty?
Answers (2)
Why are rules protecting private property some of the most important rules in a free market system?
Answers (2)
Kenner company produces two products: SR200 and TX500. Budged sales for four months are as follows; SR200 TX500 May 8,000 20,000 June 13,000 32,000 July 11,000 39,000 August 18,000 46,000 Kenner's ending inventory policy is that SR200 should have
Answers (1)
New Questions in Business
Maria is worried about the representativeness of her study. she is conducting interviews, but each one seems to last at least 3 hours. given that she has one month to collect her data, what strategy might she use to increase her sample size?
Answers (1)
What are some drawbacks and risks to a broad generic strategy? To a focused strategy?
Answers (1)
Marshall's & Co. purchased a corner lot in Eglon City five years ago at a cost of $640,000. The lot was recently appraised at $810,000.
Answers (1)
Since February, the Federal Reserve has raised its short-term interest rate target five times, and because of the economy's continued strength, analysts have been predicting for weeks that the target will be raised again in November.
Answers (1)
Student loans, car loans, and housing loans are good examples of long-term liabilities. personal obligations. current liabilities. short-term debts.
Answers (1)
Home » Business » if Dawn's disposable income increases from $30,000 to $35,000 what is his marginal propensity to consume if he spends $4,000 of the increase on consumer products?
Sign Up Forgot Password?