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Question : When income rises from Rs. 5000 to Rs. 6000, savings rises by Rs. 600. Find MPC.
 

Option 1: 0.6
 

Option 2: 0.4
 

Option 3: 0.7
 

Option 4: None of the above.
 


Team Careers360 25th Jan, 2024
Answer (1)
Team Careers360 26th Jan, 2024

Correct Answer: 0.4
 


Solution : Savings= 600, Consumption=400

MPC=\frac{\Delta Consumption}{\Delta Income}

MPC=\frac{\400}{1000}

MPC=0.4

Hence, Option B is correct.

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