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Finger [1]
2 years ago
13

suppose you get $500 for your birthday and you spend $350 and save the remaining $150. the marginal propensity to save or mps is

equal to
Business
1 answer:
arsen [322]2 years ago
8 0

The marginal propensity to save is equal to 0.3.

<h3>What is the marginal propensity to save?</h3>

The marginal propensity to save is the proportion of a person's income that is saved as opposed to spending it on consumption.

The marginal propensity to save is the ratio of the amount saved to income. The marginal propensity to save is used to quantify the relationship between changes in savings and changes in income.

In economics, it is assumed that disposable income is either saved or consumed. Thus, the marginal propensity to save and the marginal propensity to consume would be equal to one. The marginal propensity to consume is the ratio of amount spent on consumption to income.

The marginal propensity to save = amount that is saved / income

$150 / $500 = 0.3

To learn more about marginal propensity to save, please check: brainly.com/question/19089833

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