Additional income example sentences

8 (= mpc) fraction of their additional income on consumption.It gives us the ratio of total additional planned savings in an economy to the total additional income of the economy.Since bee-keeping needs low investments, farmers use it as an additional income generating activity.This process goes on, round after round, with producers increasing their output to clear the excess demand in each round and consumers spending a part of their additional income from this extra production on consumption items – thereby creating further excess demand in the next round.Since consumption is the complement of savings (additional income of the economy is either put into additional savings or used for extra consumption by the people), if we subtract the mps from 1, we get the marginal propensity to consume (mpc), which, in a similar way, is the fraction of total additional income that people use for consumption.Different people plan to save different fractions of their additional incomes (with the rich typically saving a greater proportion of their income than the poor), and if we average these we may arrive at a fraction which will give us an idea of what proportion of the total additional income of the economy people wish to save as a whole.