Economics Online Statistics Home Definitions Videos Quizzes Questions

The marginal propensity of consume

News


Gender pay gap

80% of UK companies and public sectors organisations pay women less than men.

Read more

Marginal propensity to consume - definition

The marginal propensity to consume (mpc) is the extra consumer spending arising from an increase in national income, expressed as:

C
Y

If we take the following figures for GPD and consumption we can calculate the mpc:


  2018 2019
GDP $800bn $840bn
Consumption $500bn $525bn

This gives us:


  2018 2019
GDP   + $40bn
Consumption   + $25bn

Therefore, the mpc is:

$25bn/$40bn; = 0.625




WTO rules

What exactly is the 'most favoured nation' rule?

Read more
Read more
Model agencies collude to fix rates

Regulators find leading model agencies guilty of price fixing.

Read more
Read more
Read more
Read more
Customs unions

Costs and benefits of customs unions.

Read more
New materials

Multiple choice papers for Paper Three.

Read more
Savings ratio

Savings ratio falls to lowest level on record.

Read more