Question

What is your marginal rate of consumption (MPC)? If your income increased $1,000 per month until...

What is your marginal rate of consumption (MPC)? If your income increased $1,000 per month until retirement, how much would your spending on consumption goods increase?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

This is a hypothetical situation. Based on how much of your increased income you spend on your consumption would decide this.

I personally use no more than 40% of the additional income I earn. When the income would be increased by $1000 per month, my spending on consumption goods would increase by 1000*0.4= $400.

Based on your experience, place your value of MPC in the above calculation and compute your tendency to increase the consumption for the increase in income.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
In the past, how has your consumption changed as the amount of your income increased and...
In the past, how has your consumption changed as the amount of your income increased and decreased over the years? How do you supplement for periods of low-income (for example if you are not working while you are in college)? Finally, compare your MPC now to what you think your MPC would be once you graduate and get a high-paying job. Do you think it will remain constant, increase, or decrease? Why?
Suppose that my autonomous consumption=$35,000; disposable income=$12,000; and MPC=0.82. Solve for my marginal propensity to save....
Suppose that my autonomous consumption=$35,000; disposable income=$12,000; and MPC=0.82. Solve for my marginal propensity to save. Suppose that everyone in society has a MPC of 0.92. If the government spends $40,000,000, how much total spending would this create according to Keynes? Suppose that I find $130 on the ground as I leave my office. I decide to treat myself and spend $80 on a lobster dinner and save the remaining $50. What is my MPC? Solve and then explain what...
If autonomous consumption is $1000, the MPC = 0.75, net taxes = $500, investment spending =...
If autonomous consumption is $1000, the MPC = 0.75, net taxes = $500, investment spending = $800, and govt purchases = $500, and NX = $0, what is equilibrium GDP? Question 1 options: $1,800 $1,925 $2,566.70 $7,200 $7,700 Question 2 (1 point) The focus of the short-run macro model is on the role of Question 2 options: spending in explaining economic fluctuations labor in explaining economic fluctuations financial markets in explaining economic fluctuations output in explaining economic fluctuations resources in...
In 2013 Bill earned $55,000 gross income and rented an apt for $1,000 per month. Given...
In 2013 Bill earned $55,000 gross income and rented an apt for $1,000 per month. Given this is all the information you have, 25% tax rate, no other deductions and a standard deduction of $5,000. What are his total taxes due, his marginal rate, his average rate, and how much was his monthly take home pay?
For utility maximization, consumers will purchase different consumption bundles until their marginal utility per dollar are...
For utility maximization, consumers will purchase different consumption bundles until their marginal utility per dollar are equal. So, when the marginal utility of beef is 10 at price of $5 per lb and the marginal utility of chicken is 8 at price of $3 per lb, will you purchase more beef or chicken? Explain briefly about your decision.
If the consumption function is C = $400 billion + 0.8Y, (a) What is the MPC?...
If the consumption function is C = $400 billion + 0.8Y, (a) What is the MPC? (b) How large is autonomous C? $ billion (c) How much do consumers spend with incomes of $4 trillion? $ billion (d) How much do they save? Instructions: Enter your response rounded to the nearest whole number. $ billion
Aggregate Output/Income Net Taxes Planned Investment Aggregate Consumption Government Spending 1,000 200 200 680 200 1,100...
Aggregate Output/Income Net Taxes Planned Investment Aggregate Consumption Government Spending 1,000 200 200 680 200 1,100 200 200 760 200 1,200 200 200 840 200 1,300 200 200 920 200 1,400 200 200 1,000 200 1,500 200 200 1080 200 1,600 200 200 1,160 200 Please show calculation a. Complete the table by determining the aggregate expenditure, the unplanned inventory change, savings and disposable income at all income levels                           b.               Determine the marginal propensity to consume (MPC) and marginal...
Assume that the consumption schedule in the US economy is given by C= $20 billion +...
Assume that the consumption schedule in the US economy is given by C= $20 billion + 0.8D Where C is consumption in billion and D is disposible income (in billion) . Answer the following a) Obtain marginal propensity to consume (MPC) and marginal propensity to save (MPS). b) Obtain consumption, average propensity to consume (APC) and  marginal propensity to save  (APS), when D = $200 billion. c) obtain the tax multiplier and spending multiplier. d) Suppose a negative demand shock caused real...
You want to receive $5,000 per month in retirement. If you can earn .75% per month...
You want to receive $5,000 per month in retirement. If you can earn .75% per month and you expect to need the income for 25 years, how much do you need to have in your account at retirement? You want to receive $5,000 per month for the next 5 years. What monthly rate would you need to earn if you only have $200,000 to deposit? You are saving for a new car and plan to put $3,000 per year in...
Assume your goal is to retire at age 65 and you estimate you will live until...
Assume your goal is to retire at age 65 and you estimate you will live until age 90. Your income at age 30 is $50,000 and you expect this to increase at a rate of 8% per year. The nominal rate of return on your investment portfolio is 6% and you plan to save 15% of your income per year. The expected rate of inflation is 3%. How much will your fund pay per year during your retirement?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT