The average propensity to consume is the
A) percentage of total disposable income consumed.
B) rate at which real disposable income changes as autonomous consumption changes.
C) ratio of changes in planned consumption to changes in real disposable income.
D) slope of the consumption function.

Question

Quizplus · Accepted Answer

The average propensity to consume is defined as the percentage of total disposable income that is consumed, which means it measures the proportion of income that households are willing to spend on consumption rather than save.

The Average Propensity to Consume Is the