mjb08a_M91_RETURNED

# mjb08a_M91_RETURNED - Marginal Propensity to Consume and...

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Marginal Propensity to Consume and the Multiplier Investment \$1,000,000.00 MPC 0.1 Multiplier 1.11 Round # Spending in this round Cumulative Spending 1 \$1,000,000.00 \$1,000,000.00 2 \$100,000.00 \$1,100,000.00 3 \$10,000.00 \$1,110,000.00 4 \$1,000.00 \$1,111,000.00 5 \$100.00 \$1,111,100.00 6 \$10.00 \$1,111,110.00 7 \$1.00 \$1,111,111.00 8 \$0.10 \$1,111,111.10 9 \$0.01 \$1,111,111.11 10 \$0.00 \$1,111,111.11 11 \$0.00 \$1,111,111.11 12 \$0.00 \$1,111,111.11 13 \$0.00 \$1,111,111.11 14 \$0.00 \$1,111,111.11 15 \$0.00 \$1,111,111.11 16 \$0.00 \$1,111,111.11 17 \$0.00 \$1,111,111.11 18 \$0.00 \$1,111,111.11 19 \$0.00 \$1,111,111.11 20 \$0.00 \$1,111,111.11

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Marginal Propensity to Consume Year Consumption Disposable Income Marginal Propensity to Consume C DI MPC = (Change in C / Change in DI) 1997 \$2,700 \$3,200 1998 \$3,000 \$3,600 1999 \$3,300 \$4,000 2000 \$3,600 \$4,400 2001 \$3,900 \$4,800 2002 \$4,200 \$5,200 Change in C (3000 - 2700) MPC = ------------------ = ------------------- = 0.75 Change in DI (3600 - 3200)
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## This note was uploaded on 05/01/2010 for the course BUS 5529 taught by Professor Wood during the Spring '10 term at Abilene Christian University.

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mjb08a_M91_RETURNED - Marginal Propensity to Consume and...

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