Tag Archives | propensity

Marginal propensity consume: How is it calculated?

Marginal propensity consume: How is it calculated? Marginal propensity to consume may be defined as ratio of the change in consumption to the change in income as the rate of change in the average propensity to consume as income changes.

By |2011-06-18T15:01:52+00:00June 18, 2011|Economics|Comments Off on Marginal propensity consume: How is it calculated?

What is the difference between average propensity to save and marginal propensity to save?

What is the difference between average propensity to save and marginal propensity to save? The concept of saving is closely connected with the concept of consumption. The excess of income over consumption is saving. In other words saving is the income which is null consumed.

By |2011-06-18T14:59:07+00:00June 18, 2011|Economics|Comments Off on What is the difference between average propensity to save and marginal propensity to save?

Keynes’ psychological law of propensity to consume explained

Keynes' psychological law of propensity to consume explained.Consumption function or propensity to consume represents functional relationship between two aggregate i.e. total Consumption and total income. It indicates how consumption expenditure.

By |2011-06-18T13:27:57+00:00June 18, 2011|Economics|Comments Off on Keynes’ psychological law of propensity to consume explained

8 essential factors that determines propensity to consume

8 essential factors that determines propensity to consume. Income is the most important factor which determines the consumption expenditure in a society. The greater the level of disposable income, the higher is the consumption.

By |2011-06-18T13:24:44+00:00June 18, 2011|Economics|Comments Off on 8 essential factors that determines propensity to consume
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