How is the slope of the curve in consump

CUET Preparation Today

Start Free Mocks

Home Questions VHSA8B5WVY

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Determination of Income and Employment

Question:

How is the slope of the curve in consumption function denoted?

Options:

Marginal Propensity to Consume

Average Propensity to Consume

1 - MPS

Both 1 and 3

Correct Answer:

Both 1 and 3

Explanation:

C = c + bY. Here b is the slope of consumption curve which is known as MPC.

MPC + MPS = 1

MPC = 1 - MPS