Ch. 9 Reading Guide

1.  Define consumption schedule.
2.  Define savings schedule.
3.  What do the average and marginal propensity to consume tell an economist?  What are the formulas for the APC and APS?
4.  What do the marginal propensities to consume and save tell an economist?  What are the formulas for MPC and MPS?
5.  Identify how an increase in each of the following would impact C and S: (you should remember this from AS/AD).
a.  wealth
b. price expectations
c  real interest rates
d.  household debt
e. taxation*