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Impact of Marginal Propensity to Consume on Individual & National Economy

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

What is the amount of extra income that is spent on the consumption of goods and services?

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1. What is the formula for marginal propensity to consume?

2. Which of the following is NOT one of the ways that marginal propensity to consume affects individuals?

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About This Quiz & Worksheet

By working through a small number of questions, you can use this quiz to increase your current grasp on the effect of MCP. The quiz questions deal with the formula to calculate MCP, how it affects different stakeholders, and a practice problem solving for MCP.

Quiz & Worksheet Goals

Use the assessment's questions to test your understanding of the following topics:

  • What extra income that is spent on goods and services is called
  • The formula to calculate MCP
  • How individuals are affected by MCP
  • The impact of MCP on the economy
  • Putting the MCP formula to use in a practice problem

Skills Practiced

This assessment will improve your skills in the following:

  • Defining key concepts - ensure that you can accurately define main phrases such as the term for extra income that is spent on goods and services
  • Problem solving - use acquired knowledge to solve practice problems involving the formula to calculate marginal propensity to consume
  • Knowledge application - use your knowledge of MCP to answer questions about how it affects individuals and how it affects the economy as a whole

Additional Learning

If you want to learn more about this assessment's material you can continue to do so by working through its complementary lesson called Impact of Marginal Propensity to Consume on Individual & National Economy. The lesson includes the following subject matter:

  • Example problem calculating MCP using its formula
  • Several effects marginal propensity to consume has on individuals
  • MCP effects on the economy
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