If a Household's Income Falls from $20,000 to $17,000 and Its

Multiple Choice

If a household's income falls from $20,000 to $17,000 and its consumption spending falls from $18,000 to $15,000,then its:

A) marginal propensity to consume is −0.67.
B) marginal propensity to consume is 0.88.
C) marginal propensity to consume is 0.20.
D) marginal propensity to save is 0.
E) marginal propensity to save is 0.12.