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Question
Answer the following question.
What is meant by a propensity to consume?
Solution
The propensity to consume means the proportions of total income or of in increase an income that consumers tend to spend on goods and services rather than save.
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RELATED QUESTIONS
Marginal propensity to consume + marginal propensity to save ......................... '
(zero \ one \ less \ more)
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| Column A | Column B | ||
| (1) | MPC | (a) | Ratio of Savings to Consumption |
| (2) | APC | (b) | Ratio of Consumption to Income |
| (3) | APS | (c) | Ratio of Consumption to Savings |
| (4) | MPS | (d) | Ratio of Savings to Investment |
