Economy, asked by ayush75819157, 2 months ago

What is relationship between marginal propensity to consume with marginal propensity to save??

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Answered by saleha55510

Answer:

Since MPS is measured as ratio of change in savings to change in income, its value lies between 0 and 1. Also, marginal propensity to save is opposite of marginal propensity to consume. Mathematically, in a closed economy, MPS + MPC = 1, since an increase in one unit of income will be either consumed or saved.

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