Which of the following statements is TRUE?
A)APC + APS = 1
B)APC + APS

Name: Which of the following statements is TRUE? A)APC + APS = 1 B)APC + APS < 1 C)APC + MPS = 1 D)APC + APS + MPC + MPS = 1
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Question

Which of the following statements is TRUE?
A)APC + APS = 1
B)APC + APS < 1
C)APC + MPS = 1
D)APC + APS + MPC + MPS = 1

Quizplus · Accepted Answer

APC (average propensity to consume) and APS (average propensity to save) always add up to 1, because any income not consumed is saved, and any income not saved is consumed. So, APC + APS = 1.

Which of the Following Statements Is TRUE