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Value of average propensity to save can ...

Value of average propensity to save can never be less than zero.
OR
Average propensity to save is always greater than zero.
OR
Average propensity to save can never be negative.

Text Solution

Verified by Experts

False. : APS can be negative at low level of income when consumption expenditure is greater than income.
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Knowledge Check

  • Average propensity to consume is defined as

    A
    Aggregate consumption + Total population
    B
    Aggregate income + Aggregate income `div` Aggregate consumption
    C
    Change in consumption `div` Change in income
    D
    Aggregate consumption `div` Aggregate income

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