in a two sector closed economy if income is zero then APC will also be zero
Answers
APC → .
APC refers to the average propensity to consume ie that portion of of income which is spent by a consumer in consuming .
APC = Total consumption/ total income .
APC can never be equal to zero even if the income is zero . Because of the presence of autonomous consumption.
It implies that there will always be consumption hence average propensity to consume can never be zero .
Answer:
APC → .
APC refers to the average propensity to consume ie that portion of of income which is spent by a consumer in consuming .
APC = Total consumption/ total income .
APC can never be equal to zero even if the income is zero . Because of the presence of autonomous consumption.
It implies that there will always be consumption hence average propensity to consume can never be zero .
Explanation:
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