The marginal propensity to save (MPS) is the
A) fraction of additional income that is saved.
B) amount of saving that is later consumed.
C) total amount of income that is saved.
D) part of consumption spending that does not depend on income.
Question 2
An increase in real net exports leads to an increase in real GDP. Further
A) real consumption spending increases while real investment spending decreases.
B) real government spending decreases to offset the increase in real net exports.
C) real consumption spending and real saving increase.
D) real consumption spending increases but real saving does not change.
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