Question

How to calculate the value of average propensity to consume, if in an economy, autonomous consumption is 500 crores,?

Answer 1

C= autonomous consumption + MPC(Y)

C= 500 + MPC(0)  [when autonomous consumption is there then income (Y) is 0]

C=500

Now, we know that,

APS= C/Y

APS= 500/0