Which one of the following is TRUE?
A)APC + MPS = 1
B)APC + APS = 1
C)MPS + APS = 1
D)APC * APS = 1

Name: Which one of the following is TRUE? A)APC + MPS = 1 B)APC + APS = 1 C)MPS + APS = 1 D)APC * APS = 1
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Question

Quizplus · Accepted Answer

According to the marginal propensity to save (MPS) and the marginal propensity to consume (MPC), the sum of the two should be equal to 1. Therefore, the only option that correctly represents this relationship is (B) APC + APS = 1, where APS represents the marginal propensity to save.

Which One of the Following Is TRUE