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in Economics by (45.3k points)
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An economy is in equilibrium. From the following data, calculate the marginal propensity to save : 

(a) Income = 10,000 

(b) Autonomous consumption = 500 

(c) Consumption expenditure = 8,000

1 Answer

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Best answer

Consumption Expenditure = Autonomous consumption + (Marginal propensity to consume x National income)

or 

Marginal propensity to consume x National income = Consumption expenditure – Autonomous consumption

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