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Many Macro Actions Require Additional Information, Called the Parameters of the Action

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Many macro actions require additional information, called the parameters of the action.

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Definitions:

Disposable Income

Post-tax income households possess for saving or spending purposes.

Disposable Income

Disposable income refers to the sum of money that families can use for expenditures and savings once income taxes are deducted.

MPS (Marginal Propensity to Save)

The proportion of an increase in income that an individual or population saves rather than spends on consumption.

APC (Average Propensity to Consume)

The fraction of income that households plan to spend on goods and services; it is the ratio of total consumption to total disposable income.

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