Question

1. The average propensity to save is measured by​

Answer 1

Answer:

The formula to calculate APS is total savings divided by income level for which we want to determine APS. For example, if the income level is 100 and total savings for that level is 30, then APS is 30/100 or 0.3. APS can never be 1 or greater than 1. That said, APS can have a negative value, if income is zero and consumption has a positive value. For example, if income is 0 and consumption is 30, then the APS value will be -0.3.

The formula to calculate APS is total savings divided by income level for which we want to determine APS. For example, if the income level is 100 and total savings for that level is 30, then APS is 30/100 or 0.3. APS can never be 1 or greater than 1. That said, APS can have a negative value, if income is zero and consumption has a positive value. For example, if income is 0 and consumption is 30, then the APS value will be -0.3.

Answer 2

Answer:

The average propensity to consume could also be calculated by subtracting the APS from 1

Explanation:

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