Question : What is the value of MPC in the following consumption function
C= 200+0.90Y and also determinne consumption at income level of 500.
Option 1: 200, 600
Option 2: 0.10, 650
Option 3: 0.90, 650
Option 4: None of the above.
Answer (1)
18th Jan, 2024
Correct Answer: 0.90, 650
Solution : C= 200+0.90Y
MPC= 0.90
C= 200+0.90(500)
C= 650
Hence, Option C is correct.
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