# Suppose C(x) measures an economy's personal consumption expenditure and x the personal income, both in billions of dollars. Then the following function measures the economy's savings corresponding to an income of x billion dollars.S(x) = x - C(x)    (Income minus consumption)The quantity dS/dx below is called the marginal propensity to save.dS/dx=1-dC/dxFor the following consumption function, find the marginal propensity to save.C(x) = 0.634x + 95.23

Question
Asked Sep 17, 2019
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Suppose C(x) measures an economy's personal consumption expenditure and x the personal income, both in billions of dollars. Then the following function measures the economy's savings corresponding to an income of x billion dollars.

S(x) = x - C(x)    (Income minus consumption)

The quantity dS/dx below is called the marginal propensity to save.

dS/dx=1-dC/dx

For the following consumption function, find the marginal propensity to save.

C(x) = 0.634x + 95.23
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Step 1

Given marginal propensity is the first derivative of S(x) and given C(x) = 0.634x + 95.23

Step 2

Then we find ...

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