Marginal Propensity to Save
Definition
Share of an extra dollar of income saved. Equals 1 minus MPC.
Example
MPC of 0.75 implies MPS of 0.25 — a quarter of any extra dollar is saved.
Share of an extra dollar of income saved. Equals 1 minus MPC.
MPC of 0.75 implies MPS of 0.25 — a quarter of any extra dollar is saved.