assume the marginal propensity to consume out of disposable income is 0.8 and that the government taxes all income at a constant rate of 30%. if gross income increases by $100, consumption will initially increase by assume the marginal propensity to consume out of disposable income is 0.8 and that the government taxes all income at a constant rate of 30%. if gross income increases by $100, consumption will initially increase by $56. $100. $70. $80.
