Question

The marginal propensity to import is equal to​ _______.
A. the change in imports divided by the change in real​ GDP, other things remaining the same
B. the change in net imports divided by the change in disposable​ income, other things remaining the same
C. imports minus exports
D. disposable income minus consumption expenditure minus saving divided by real GDP

Answer 1

Answer: Option a

                                           

Explanation: In simple words, marginal propensity to import refers to the change in the level of import in an economy due to change in the level of disposable income.

However the marginal propensity is calculated with respect to volume and not price thus it is calculated by dividing the change in imports with the real GDP in the given tear.