Assuming that = $20,000 and C = $22,000, we would find that the average propensity to save equals
A) 0.9.
B) 1.1.
C) -0.1.
D) -0.8.

Question

Assuming that  = $20,000 and C = $22,000, we would find that the average propensity to save equals
A) 0.9. 
B) 1.1. 
C) -0.1. 
D) -0.8.

Quizplus · Accepted Answer

The given information does not provide any information about the income of the individual, hence we cannot calculate the average propensity to save. The formula to calculate the average propensity to save is: 
APS = (Savings/Income)
Without information on income, we cannot compute APS.

Assuming That = $20,000 and C = $22,000, We