What is the marginal propensity to consume

Reference no: EM13906424

If equilibrium output rises by a total of $400 billion in response to an increase in government spending of $80 billion, what is the marginal propensity to consume? (the answer in .8 but I need an explanation on how/why)

Reference no: EM13906424

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What is the marginal propensity to consume : If equilibrium output rises by a total of $400 billion in response to an increase in government spending of $80 billion, what is the marginal propensity to consume? (the answer in .8 but I need an explanation on how/why)

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