$$\begin{array} { | c | r | }
\hline \text { Disposable Income } & \text { Saving } \
\hline \$ 0 & - \$ 10 \
\hline 50 & 0 \
\hline 100 & 10 \
\hline 150 & 20 \
\hline 200 & 30 \
\hline
\end{array}$$ Refer to the given data for a hypothetical economy. At the $100 level of income, the average propensity to save is
A) 0.10.
B) 0.20.
C) 0.25.
D) 0.90.

Question

$$\begin{array} { | c | r | } 
\hline \text { Disposable Income } & \text { Saving } \
\hline \$ 0 & - \$ 10 \
\hline 50 & 0 \
\hline 100 & 10 \
\hline 150 & 20 \
\hline 200 & 30 \
\hline
\end{array}$$ Refer to the given data for a hypothetical economy. At the $100 level of income, the average propensity to save is
A) 0.10.
B) 0.20.
C) 0.25.
D) 0.90.

Quizplus · Accepted Answer

The average propensity to save (APS) is calculated as saving divided by disposable income. At a $100 level of income, saving is $10. Therefore, APS = $10 / $100 = 0.10.

Refer to the Given Data for a Hypothetical Economy