The consumption function has the form: C = 100 + 0.8 Y.
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The consumption function has the form: C = 100 + 0.8 Y.
The consumption function has the form: C = 100 + 0.8 Y.
a) calculate consumer spending (consumption) and savings at these income values:
Income
Consumption
Saving
600
800
1000
1200
1400
b) build a consumption schedule;
c) calculate the marginal propensity to consume and the marginal propensity to save;
d) calculate the expense multiplier.
Decision:
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