If you have a payroll of $60 million dollars. For every payroll dollar about 4

  1. profile image47
    swebbkdsposted 7 years ago

    If you have a payroll of $60 million dollars.  For every payroll dollar about 4 more are...

    generated through the area, what is the marginal propensity to consume?

  2. Brupie profile image73
    Brupieposted 7 years ago

    This doesn't make much sense.  Marginal propensity to consume (mpc) is calculated on the rate of consumption from the marginal increase in income, it also requires information about the disposable income.

    For instance, if I make $50,000/year and receive a bonus of $1,000 but I use all of it to cover my increase in property taxes, my mpc is zero.  If I spend it all on things other than taxes, the rate is .02 (1,000 / 50,000).

 
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