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Match List - I with List - II.

List - IList - II
(A)Marginal Propensity to Save(I)ΔYΔI\frac{\Delta Y}{\Delta I}
(B)Average Propensity to Consume(II)ΔSΔY\frac{\Delta S}{\Delta Y}
(C)Value of Investment Multiplier(III)1 - APS
(D)Marginal Propensity to Consume(IV)ΔCΔY\frac{\Delta C}{\Delta Y}

Choose the correct answer from the options given below :

Solution

Correct Option: 2

MPS = ΔSΔY\frac{\Delta S}{\Delta Y} so (A)-(II).

APC = 1 - APS, so (B)-(III).

Investment Multiplier = ΔYΔI\frac{\Delta Y}{\Delta I}, so (C)-(I).

MPC = ΔCΔY\frac{\Delta C}{\Delta Y}, so (D)-(IV).

The correct matching is (A)-(II), (B)-(III), (C)-(I), (D)-(IV).

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