With an increase in national income, both APC and APS fall. True/false
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Solution
False.
APC refers to
Average Propensity to Consume which defines the amount of consumption in every
1 rupee of income for all level of income where as APS refers to Average Propensity to save which
defines the amount of savings in every 1 rupee of income for all level of
income. Therefore, if income rises then the proportion of APC increases at a diminishing rate where as the proportion of APS increases at an increasing rate.