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

Question 34

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 zero
E) marginal propensity to save is 0.12

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