Regarding Average Propensity to Save APS A APS can be zero B APS can be more than one C APS can be n...........

Economics (CUET) Determination of Income and Employment

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Regarding Average Propensity to Save (APS):

(A) APS can be zero

(B) APS can be more than one

(D) APS can be one

(E) APS can be positive

Choose the correct answer from the options given below:

This questions was previously asked in

CUET ECONOMIC Previous Year Paper 2023

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(A), (C), (E) Only

(A), (E), (D) Only

(A), (B), (E) Only

(A), (B), (C) Only

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Explanation:

Explanation:
•APS can be zero: This happens when all income is consumed (Savings = 0).
•APS can be negative: This happens when there is dissaving, meaning consumption exceeds income.
•APS can be positive: This occurs when some portion of income is saved.
•APS cannot be more than one: Since APS = S/Y and savings (S) is never greater than income (Y), APS cannot exceed 1.
•APS cannot be exactly one: This would mean that the entire income is saved and no consumption occurs, which is unrealistic in normal economic conditions.