Slope of Saving Line
Marginal propensity to save is also used as an alternative term for slope of saving line. The slope of a saving line is given by the equation S = -a + (1-b)Y, where -a refers to autonomous savings and (1-b) refers to marginal propensity to save (here b refers to marginal propensity to consume but as MPC + MPS = 1, so (1-b) refers to MPS).
In this diagram, the savings function is an increasing function of disposable income i.e. savings increase as income increases.
Read more about this topic: Marginal Propensity To Save
Famous quotes containing the words saving and/or line:
“The American people is out to get the kaiser. We are bending every nerve and every energy towards that end; anybody who gets in the way of the great machine the energy and devotion of a hundred million patriots is building towards the stainless purpose of saving civilization from the Huns will be mashed like a fly. I’m surprised that a collegebred man like you hasn’t more sense. Don’t monkey with the buzzsaw.”
—John Dos Passos (1896–1970)
“What, will the line stretch out to the crack of doom?”
—William Shakespeare (1564–1616)