MPC Variation by Household Wealth
The marginal propensity to consume (MPC) differs significantly based on a household's wealth. Low-wealth households tend to have a high MPC, potentially 0.8 or even higher, because their spending is closely tied to their current income. In contrast, wealthy households typically have an MPC that is much closer to zero, as their consumption patterns are less affected by short-term income changes.
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Introduction to Macroeconomics Course
Ch.3 Aggregate demand and the multiplier model - The Economy 2.0 Macroeconomics @ CORE Econ
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