Identify the correct option.

MPC + MPS = 1

The correct option is Option 1: MPC + MPS = 1.

The marginal propensity to consume (MPC) is the fraction of additional income that is spent on consumption. The marginal propensity to save (MPS) is the fraction of additional income that is saved. The sum of MPC and MPS must always be equal to 1, because all of additional income must either be consumed or saved.

Option 2, MPC - MPS = 1, is incorrect because MPC and MPS are not always equal. In fact, MPC is typically greater than MPS, which means that people tend to spend more than they save out of their additional income.

Option 3, MPS + 1 = 0, is incorrect because MPS cannot be negative. MPS is a fraction of additional income, and fractions cannot be negative.

Option 4, MPS + 1 = 1, is incorrect because MPS cannot be greater than 1. This would mean that people are saving more than they are earning, which is not possible.

Therefore, the only correct option is MPC + MPS = 1.