The marginal propensity to consume (MPC) is computed as the change in:

Question

consumption divided by the change in savings

consumption divided by the change in disposable personal income

consumption divided by the change in GDP

none of the above

Answer 1

The marginal propensity to consume (MPC) is computed as the change in consumption divided by the change in disposable personal income.

So the correct answer is:

consumption divided by the change in disposable personal income.