-Consider the above figure. At income level Yd = $110, the APS is equal to
A) 0.64.
B) 0.32
C) 1.10.
D) -0.36.

Question

-Consider the above figure. At income level Yd = $110, the APS is equal to
A) 0.64. 
B) 0.32 
C) 1.10. 
D) -0.36.

Quizplus · Accepted Answer

APS (Average Propensity to Save) is calculated as savings divided by disposable income. At Yd = $110, if the APS is 0.32, it means the individual is saving 32% of their disposable income. Without the specific figure or graph mentioned, the general approach to find APS is to use the formula APS = Savings/Yd. Given the options and the context, an APS of 0.32 suggests that for every dollar of disposable income, $0.32 is saved, which is a plausible scenario compared to the other options provided.

-Consider the Above Figure