What happens to Marginal Propensity to Consume when there is taxation by government?
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Solution 1
When the government imposes taxes, the disposable income of individuals decreases. This means that people have less money to spend after they have paid their taxes.
The Marginal Propensity to Consume (MPC) is the increase in consumer spending due to an increase in income. If income decreases becau Knowee AI is a powerful AI-powered study tool designed to help you to solve study problem.
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