Jack Nelson, a Supervisor in the Hardware Department at Sears

question 53

Multiple Choice

Jack Nelson, a supervisor in the hardware department at Sears, received a $3,000 increase in his annual disposable income.Suppose his marginal propensity to consume is 0.80.How much of the $3,000 increase will Jack spend on consumption?

• A) $2,750
• B) $2,500
• C) $2,400
• D) $2,200
• E) $3,000.