Match List-I with List-II List-

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Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Determination of Income and Employment

Question:

Match List-I with List-II

List-I	List-II
(A) Marginal Propensity to Consume	(I) C/Y
(B) Marginal Propensity to Save	(II) ΔC/ ΔY
(C) Average Propensity to Save	(III) S/Y
(D) Average Propensity to Consume	(IV) ΔS/ΔY

Choose the correct answer from the options given below:

Options:

(A)-(I), (B)-(II), (C)-(III), (D)-(IV)

(A)-(IV), (B)-(III), (C)-(II), (D)-(I)

(A)-(II), (B)-(IV), (C)-(III), (D)-(I)

(A)-(III), (B)-(IV), (C)-(I), (D)-(II)

Correct Answer:

(A)-(II), (B)-(IV), (C)-(III), (D)-(I)

Explanation:

The correct answer is Option (3) → (A)-(II), (B)-(IV), (C)-(III), (D)-(I)

(A) Marginal Propensity to Consume (MPC) → (II) ΔC / ΔY. It measures the change in consumption resulting from a change in income.
(B) Marginal Propensity to Save (MPS) → (IV) ΔS / ΔY. It measures the change in saving resulting from a change in income.
(C) Average Propensity to Save (APS) → (III) S / Y. It shows the proportion of income that is saved.
(D) Average Propensity to Consume (APC) → (I) C / Y. It shows the proportion of income that is consumed.