The Marginal Propensity to Save (MPS)is the

question 139

Multiple Choice

The marginal propensity to save (MPS) is the

• A) amount of saving that is later consumed.
• B) fraction of additional income that is saved.
• C) part of consumption spending that does not depend on income.
• D) total amount of income that is saved.

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Definitions:

Marginal Revenue

The additional income earned from the sale of one more unit of a product or service.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase at various prices.

Total Revenue

Total Revenue is the total amount of money received by a company from its sales of goods or services, before any expenses are subtracted.

Marginal Cost

The increase in total cost that arises from producing one additional unit of a product.