Point consumer equalibrium
Suppose that marginal utility of good A is 4 times the marginal utility of good b, but the price of good a is only 2 times the price of good b. Is this point consumer equalibrium? If not, what will occur?
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If the MPC increases, what must happen to the MPS? How is the MPC related to the consumption function? How is the MPS related to the saving function?
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