As aggregate income decreases, the APC:
A)and APS will both increase.
B)will decrease, but the APS will increase.
C)will increase, but the APS will decrease.
D)and APS will both decrease.

Question

Quizplus · Accepted Answer

As aggregate income decreases, the Average Propensity to Consume (APC) tends to increase because people maintain their consumption levels despite lower income, while the Average Propensity to Save (APS) decreases as there is less income available to save.

As Aggregate Income Decreases, the APC