Question

In a country, 70 per cent of the income has been devoted to consumption in the past year. If income is Rs.10,000 crore, find out consumption?

• A. Rs 3,000 crore.
• B. Rs 5,000 crore.
• C. Rs 7,000 crore.
• D. Rs 700 crore.

Answer 1

The correct option is C Rs 7,000 crore.

Here, APC = 70 percent, Y = 10,000

Since, APC = $\frac{C}{Y}$
$C=APC\times Y$

$C=0.7\times 10,000=\text{7,000}.$

C = Rs. 7,000 crores