Please solve this question !!
Solution:
Savings = Income (Y) - Consumption (C)
Average Propensity To Save ( APS) = Savings / Income
Marginal Propensity To Save ( MPS) = Change In Savings / Change In Income
| Income (Y) (Rs.) |
Consumption (C) (Rs.) |
Savings (S) (Rs.) |
Marginal Propensity To Save (MPS) | Average Propensity To Save (APS) |
| 0 | 80 | -80 | - | - |
| 100 | 140 | -40 | 0.40 | -40/100 = -0.40 |
| 200 | 200 | 0 | 40/ 100= 0.40 | 0 |
| 300 | 240 | 60 | 60/ 100 =0.60 | 0.20 |
| 400 | 260 | 140 | 0.80 | 0.35 |
Savings = Income (Y) - Consumption (C)
Average Propensity To Save ( APS) = Savings / Income
Marginal Propensity To Save ( MPS) = Change In Savings / Change In Income
