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What will be APC when APS = 0?
One
Zero
Two
Infinite
- Average Propensity to Save (APS) = 0
- This means that people are not saving any part of their income. Their entire income is being spent.
- Average Propensity to Consume (APC)
- APC is the fraction of total income that is consumed.
- If APS is 0, it implies the entire income is consumed, as none is saved.
- Option 1: One
- This is correct. If APS = 0, then APC must be 1. This is because all the income is spent.
- Option 2: Zero
- If APC were zero, it would mean no income is used for consumption, which contradicts APS = 0.
- Option 3: Two
- APC cannot be more than 1 because you can't consume more than total income without saving.
- Option 4: Infinite
- Infinite doesn't apply to proportions like APC, which has a maximum value of 1.
Option:1 - One is correct.
By: santosh ProfileResourcesReport error
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