[{"data":1,"prerenderedAt":250},["ShallowReactive",2],{"term:marginal-propensity-to-consume":3},{"term":4,"related":237},{"id":5,"title":6,"body":7,"category":219,"description":220,"extension":221,"faq":222,"meta":223,"navigation":224,"path":225,"related":226,"seo":230,"stem":231,"takeaways":232,"__hash__":236},"terms\u002Fterms\u002Fmarginal-propensity-to-consume.md","Marginal Propensity to Consume (MPC)",{"type":8,"value":9,"toc":213},"minimark",[10,15,19,22,26],[11,12,14],"h2",{"id":13},"understanding-marginal-propensity-to-consume","Understanding Marginal Propensity to Consume",[16,17,18],"p",{},"If you receive an extra $100 and spend $80, your MPC is 0.8; the remaining 0.2 is your marginal propensity to save.",[16,20,21],{},"MPC is usually higher for lower-income and cash-constrained households, which is why the design of stimulus payments affects how much they boost spending.",[11,23,25],{"id":24},"formula","Formula",[27,28,31],"span",{"className":29},[30],"katex-display",[27,32,35,83],{"className":33},[34],"katex",[27,36,39],{"className":37},[38],"katex-mathml",[40,41,44],"math",{"xmlns":42,"display":43},"http:\u002F\u002Fwww.w3.org\u002F1998\u002FMath\u002FMathML","block",[45,46,47,78],"semantics",{},[48,49,50,54,58],"mrow",{},[51,52,53],"mtext",{},"MPC",[55,56,57],"mo",{},"=",[59,60,61,71],"mfrac",{},[48,62,63,68],{},[64,65,67],"mi",{"mathvariant":66},"normal","Δ",[64,69,70],{},"C",[48,72,73,75],{},[64,74,67],{"mathvariant":66},[64,76,77],{},"Y",[79,80,82],"annotation",{"encoding":81},"application\u002Fx-tex","\\text{MPC} = \\frac{\\Delta C}{\\Delta Y}",[27,84,88,117],{"className":85,"ariaHidden":87},[86],"katex-html","true",[27,89,92,97,105,110,114],{"className":90},[91],"base",[27,93],{"className":94,"style":96},[95],"strut","height:0.6833em;",[27,98,102],{"className":99},[100,101],"mord","text",[27,103,53],{"className":104},[100],[27,106],{"className":107,"style":109},[108],"mspace","margin-right:0.2778em;",[27,111,57],{"className":112},[113],"mrel",[27,115],{"className":116,"style":109},[108],[27,118,120,124],{"className":119},[91],[27,121],{"className":122,"style":123},[95],"height:2.0463em;vertical-align:-0.686em;",[27,125,127,132,209],{"className":126},[100],[27,128],{"className":129},[130,131],"mopen","nulldelimiter",[27,133,135],{"className":134},[59],[27,136,140,200],{"className":137},[138,139],"vlist-t","vlist-t2",[27,141,144,195],{"className":142},[143],"vlist-r",[27,145,149,168,179],{"className":146,"style":148},[147],"vlist","height:1.3603em;",[27,150,152,157],{"style":151},"top:-2.314em;",[27,153],{"className":154,"style":156},[155],"pstrut","height:3em;",[27,158,160,163],{"className":159},[100],[27,161,67],{"className":162},[100],[27,164,77],{"className":165,"style":167},[100,166],"mathnormal","margin-right:0.2222em;",[27,169,171,174],{"style":170},"top:-3.23em;",[27,172],{"className":173,"style":156},[155],[27,175],{"className":176,"style":178},[177],"frac-line","border-bottom-width:0.04em;",[27,180,182,185],{"style":181},"top:-3.677em;",[27,183],{"className":184,"style":156},[155],[27,186,188,191],{"className":187},[100],[27,189,67],{"className":190},[100],[27,192,70],{"className":193,"style":194},[100,166],"margin-right:0.0715em;",[27,196,199],{"className":197},[198],"vlist-s","​",[27,201,203],{"className":202},[143],[27,204,207],{"className":205,"style":206},[147],"height:0.686em;",[27,208],{},[27,210],{"className":211},[212,131],"mclose",{"title":214,"searchDepth":215,"depth":215,"links":216},"",2,[217,218],{"id":13,"depth":215,"text":14},{"id":24,"depth":215,"text":25},"economy","The share of an extra dollar of income that a household spends.","md",[],{},true,"\u002Fterms\u002Fmarginal-propensity-to-consume",[227,228,229],"fiscal-multiplier","consumption-function","paradox-of-thrift",{"title":6,"description":220},"terms\u002Fmarginal-propensity-to-consume",[233,234,235],"MPC = change in consumption ÷ change in income.","MPC + MPS = 1.","A higher MPC means a larger multiplier.","WlZDu9DWfYXYiLAMV4xd6sjS594QwGcfM0tZWEv_TZ0",[238,242,246],{"title":239,"description":240,"path":241},"Consumption Function","The relationship between household spending and income.","\u002Fterms\u002Fconsumption-function",{"title":243,"description":244,"path":245},"Fiscal Multiplier","How much total output changes for each dollar of government spending or tax cuts.","\u002Fterms\u002Ffiscal-multiplier",{"title":247,"description":248,"path":249},"Paradox of Thrift","When everyone tries to save more at once, total saving may not rise because income falls.","\u002Fterms\u002Fparadox-of-thrift",1793374005390]