Advertisements
Advertisements
Question
What is saving at a point where income equals consumption on the 45° line?
Options
Saving is positive.
Saving equals autonomous consumption.
Saving is zero.
Saving equals MPC.
MCQ
Advertisements
Solution
On the 45° line, \[C=Y\]. Since all income is consumed, there is no saving, so saving equals zero.
shaalaa.com
Is there an error in this question or solution?
