Marginal Propensity to Save: Formula & Relationship to MPC

Instructions:

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

question 1 of 3

What do we call the portion of extra income that is saved?

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

2. Claire usually makes $2,500 per month, but she just got a raise, and now makes $3,000 per month. After getting the raise, she decided to splurge and buy a new TV, which cost $300. What is her MPC?

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About This Quiz & Worksheet

Understanding how much money you spend versus how much you save can be very useful in managing your finances. This quiz/worksheet combo will check your knowledge of how to calculate the marginal propensity to save and other related topics.

Quiz & Worksheet Goals

This quiz and worksheet cover the following:

  • A term for extra income that is saved
  • The formula for the marginal propensity to save
  • How income and occurrence factor into what people do with extra income
  • What MPC stands for
  • The opposite of MPS

Skills Practiced

These assessments use the following skills:

  • Knowledge application - use your knowledge to check your understanding of MPC and MPS
  • Information recall - access the knowledge you've gained regarding how income can be saved or spent
  • Reading comprehension - ensure that you draw the most important information from the related lesson on the MPS formula

Additional Learning

Further your knowledge of the propensity to save by reviewing the lesson called Marginal Propensity to Save: Formula & Relationship to MPC. The lesson discusses:

  • What the amount of money we save instead of spend is called
  • The reasons a person may save or spend money
  • And example of how income may be divided
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