Question

propensity to save average and marginal derivation of savings curve from consumption curve​

Answer 1

Answer:

Explanation:

We can define marginal propensity to save as a measure of the rate at which savings change as income changes. In other words, MPS measures the relationship between change in savings expenditure with respect to a given change in the income. It is also called the slope of the savings function/curve. Where, MPS = Marginal Propensity to Save, Δϒ = Change in the income, ΔS = Change in saving, S 2 = New level of saving, S 1 = Original level of saving,