Macroeconomics
The marginal propensity to consume refers to "the proportion of an aggregate raise in pay that is spent on the consumption of goods and services" (Investopedia, 2011). That is, if there is more money in the economy, it must either be spent or saved. The MPC is the amount that is going to be saved. The marginal propensity to save is the reverse of this -- it refers to how much of the new aggregate raise in pay will be saved instead of spent. The two have a complementary relationship, with all of an aggregate increase in pay going towards one or the other.
As per the accounting identity of GDP = C + I + G + X -- M, an increase in aggregate pay is going to affect the GDP. The degree to which an increase in aggregate pay affects the GDP is going to relate to the marginal propensity to consume. If consumers spend 100% of their aggregate increase in...
Savings and Income Decline as People Increase the Saving Habit Saving refers to the income not spent by the consumer. In other words, savings are the money left when the consumer expenditures are subtracted from the disposable incomes that an individual earns over a given period. (Credo, 2006). When analyzing private and public savings, the savings refer to the sum of the public and private saving. (Credo, 2015). While private
Multiplier Thailand, like many third world countries, is interested in identifying the mechanisms by which economic growth may be achieved. Economic growth and more specifically 'rapid economic growth falls within the province of the mid-term and long-term macroeconomic policies (Dervis and Petri 1987, p. 211). Dervis and Petri, survey 20 'middle income' countries, in an attempt to identify the factors which contribute to successful development-which they identify as moderately rapid
benefit analysis of the proposed state lottery for Alabama. Assessing the costs and benefits of this lottery is challenging. The costs are ill-defined, and often lumped in with other gambling costs in general. Yet, lotteries are not the same thing as casino gambling or sports gambling. So there is a lack of hard data available. The benefits are clearer. These take into account the return on money already being
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