Marginal Propensity To Consume (MPC) Calculation
(Step by step calculation)
Marginal Propensity To Consume (MPC) Calculator
MPC mentions the increase in consumer spending owing to the increase in disposable income.
Step by step calculation
Marginal Propensity to Consume(MPC) Formula 1
MPC = C1 / C2
Where,
MPC is Marginal Propensity to Consume
C1 is Change in Consumer Spending
C2 is Change in Income
Marginal Propensity to Consume (MPC) Formula 2
Marginal Propensity to Consume (MPC) = ΔC / ΔI
Further, the MPC formula can be derived into
Marginal Propensity to Consume (MPC) = (C1 - C0) / (I1 - I0)
C0 = Initial Consumer Spending
C1 = Final Consumer Spending
I0 = Initial Disposable Income
I1 = Final Disposable Income