Propensity to consume means a mere desire to consume.

True

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False

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Solution

The correct option is B False
Propensity to consume refers to the slope of consumption curve. It is calculated by diving consumption expenditure by income. It refers to the amount of consumption expenditure is done for the particular level of income.

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Distinguish between Average Propensity to Consume and Marginal Propensity to Consume.

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