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Which of the following can have the value of more than one and less than zero: (i) APC, (ii) APS, (iii) MPC, and (iv) MPS ? |
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Answer» Solution :APC can be more than ONE as long as CONSUMPTION is more than national INCOME, i.e. before the break-even point, APC gt 1. APS can be less than zero at income levels which are lower that the break-even point. Both MPC and MPS cannot be more than one or less than zero as change in consumption or SAVING cannot be more than change in income. |
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