When the marginal propensity to consume is less than 1, the

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When the marginal propensity to consume is less than 1, it means that for every additional dollar of income, the consumer is saving some portion of it rather than spending all of it. Therefore, the marginal propensity to save is positive. Option A is incorrect because average propensity to consume is the total consumption divided by the total income, so it is not necessarily greater than 1. Option B is incorrect because if the marginal propensity to consume is less than 1, it means that the marginal propensity to save is greater than 0, so the average propensity to save will also be greater than 0, but not necessarily greater than 1. Option C is incorrect because a negative marginal propensity to save would mean that for every additional dollar of income, the consumer is reducing their savings, which is contradictory to the initial premise.

When the Marginal Propensity to Consume Is Less Than 1