Match List I with List I
| List I | List II | ||
| A. | $\frac{ΔC}{ΔY}$ | I. | APS |
| B. | $\frac{S}{Y}$ | II. | MPS |
| C. | $\frac{ΔS}{ΔY}$ | III. | APC |
| D. | $\frac{C}{Y}$ | IV. | MPC |
Chose the correct answer from the options given below :
Answer & explanation
Correct answer: option 4
The correct answer is option (4) : A-IV, B-I, C-II, D-III
Explanation :
- A. $\frac{ΔC}{ΔY}$ :This represents the marginal propensity to consume (MPC), indicating the change in consumption for a change in income.
- B. $\frac{S}{Y}$:This represents the average propensity to save (APS), indicating the average saving as a proportion of income.
- C. $\frac{ΔS}{ΔY}$:This represents the marginal propensity to save (MPS), indicating the change in saving for a change in income.
- D. $\frac{C}{Y}$:This represents the average propensity to consume (APC), indicating the average consumption as a proportion of income.