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Question
If the value of Average Propensity to Consume (APC) is 0.8 and National Income is ₹ 4,000 crores, the value of savings will be ______.
Options
₹ 100 crores
₹ 200 crores
₹ 800 crores
₹ 500 crores
MCQ
Fill in the Blanks
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Solution
If the value of Average Propensity to Consume (APC) is 0.8 and National Income is ₹ 4,000 crores, the value of savings will be ₹ 800 crores.
Explanation:
APC = `"C"/"Y"`
0.8 = `"C"/(₹ 4000)`
C = ₹ 3,200 crores
S = Y − C
= ₹ 4,000 − ₹ 3,200
= ₹ 800 crores
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