The following table contains data on the relationship between saving and income. Rearrange these...
Question:
The following table contains data on the relationship between saving and income. Rearrange these data into a meaningful order and graph them.
| Income per Year | Savings per Year |
|---|---|
| $15,000 | $1,000 |
| 0 | -500 |
| 10,000 | 500 |
| 5,000 | 0 |
| 20,000 | 1,500 |
What is the slope of the line? The vertical intercept? Write the equation that represents this line.
What would you predict savings to be at the $12,500 level of income?
Savings and Earnings:
A rational human being when earns, do not only use that to fulfill his wants and desires but also keeps some part as savings for unforeseen circumstances. Savings are not a major part of the earnings but when no earnings are with the consumers, these savings are used then.
Answer and Explanation: 1
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View this answerRearranging the given table gives us the following table:
Part a)
Income per Year |
Savings per Year |
0 |
-$500 |
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Marginal Propensity to Save: Formula & Relationship to MPC
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Chapter 7 / Lesson 12
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Discover what MPC and MPS in finance are. Learn about their importance and uses. Discover their formula and how to compute them through the given examples.
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