How do economists define the average propensity to consume (APC)?
A)as the proportion of any change in disposable income that becomes a change in consumption
B)as the proportion of any change in disposable income that does not become a change in consumption
C)as the fraction of total disposable income that households do not spend on consumption
D)as the fraction of total disposable income that households spend on consumption

Question

Quizplus · Accepted Answer

Economists define the average propensity to consume (APC) as the fraction of total disposable income that households spend on consumption. It is calculated by dividing consumption by disposable income.

How Do Economists Define the Average Propensity to Consume (APC)