Answered: If the MPC in an economy equals 0.8,…

If the MPC in an economy equals 0.8, and disposable income falls by P100, consumption spending will fall by * a. P0.80 b. P8.00 c. P20.00 d. P80.00 e. P500.00

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter23: The Aggregate Expenditure Model

Section: Chapter Questions

Problem 8P

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Question

If the MPC in an economy equals 0.8, and disposable income falls by P100, consumption spending will fall by *

a. P0.80

b. P8.00

c. P20.00

d. P80.00

e. P500.00

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