Final answer:
c. higher
Households with lower wealth generally have a higher Marginal Propensity to Consume (MPC) compared to wealthier households,
as they often have more immediate needs to address with any additional income.
Step-by-step explanation:
In general, households with lower wealth tend to have a higher Marginal Propensity to Consume (MPC) relative to wealthier households.
The MPC is the proportion of additional income that a consumer tends to spend on goods and services rather than saving it.
Because lower-wealth households typically have more urgent needs and fewer resources, they are far more likely to spend additional income in comparison to wealthier households which can afford to save or invest a greater proportion of their additional income.
In general, households with lower wealth tend to have a lower MPC (Marginal Propensity to Consume) relative to wealthier households.
The MPC represents the proportion of additional income that people spend rather than save. When households have lower wealth, they often have a higher tendency to save a larger proportion of their income, resulting in a lower MPC.