Question

What does \[APS=\frac{S}{Y}\] measure?

Options

• The amount of induced consumption.

• The ratio of total consumption to total income at a given level of income.

• The ratio of total saving to total income at a given level of income.

• The change in saving due to a unit change in income.

Answer 1

APS is Average Propensity to Save. It measures average saving relative to income by dividing total saving by total income.