Question

In year one adam earns $1000 and saves $100. In year 2, Adam gets a $500 raise so that he earns a total of $1,500. Out of that $1,500 he saves $200. What is Adam's MPC out of his $500 raise? a. 0.50 b. 0.75 c. 0.80 d. 1.00

Answer 1

The correct answer for the question that is being presented above is this one: "c. 0.80" In year one adam earns $1000 and saves $100. In year 2, Adam gets a $500 raise so that he earns a total of $1,500. Out of that $1,500 he saves $200. Adam's MPC out of his $500 raise is that 0.80