Question

if marginal propensity to save is equal to zero it indicates that national income of economy will be​

Answer 1

Explanation:

Marginal Propensity to Save (MPS)

In the Keynesian economic theory, the marginal propensity to save (MPS) refers to the proportion of an aggregate raise in income that a consumer saves rather than spends on the consumption of goods and services. Put differently, the marginal propensity to save is the proportion of each added dollar of income that is saved rather than spent. MPS is a component of Keynesian macroeconomic theory and is calculated as the change in savings divided by the change in income, or as the complement of the marginal propensity to consume (MPC).

Hope it helps u

Answer 2

Answer:

If entire incremental income is consumed, the change in consumption (∆C) will be equal to change in income (∆Y) making MPC = 1. In case the entire income is saved, change in consumption is zero meaning MPC = 0. ... As a person becomes richer, he tends to consume a smaller portion of increase in income.

So, if consumers saved 20 cents for every $1 increase in income, the MPC would be 0.20 (0.20 / $1). The value of the marginal propensity to save always varies between zero and one, where zero indicates that changes in income have no effect on savings whatsoever.