If there is a rise in income from Rs 40,000 to Rs 50,000, consumption increases from Rs 22,000 to 30,000, then what will be the MPC?

0.8

MPC refers to the ratio of change in consumption expenditure to change in income. The value of MPC lies between 0 and 1.

MPC = \(\frac{ΔC }{ΔY }\)

MPC = \(\frac{30,000 - 22,000}{50,000 - 40,000 }\)

MPC = \(\frac{8,000 }{10,000 }\)

MPC = 0.8