Which one of the following combinations are correct?
(A) ΔC/ΔY=Marginal Propensity to Consume (MPC).
(B) ΔS/ΔY=Marginal Propensity to Save (MPS).
(C) 1/1-APS=Investment Multiplier.
(D) 1/1- C=Investment Multiplier.
Choose the correct answer from the options given below:
Which one of the following combinations are correct?
(A) ΔC/ΔY=Marginal Propensity to Consume (MPC).
(B) ΔS/ΔY=Marginal Propensity to Save (MPS).
(C) 1/1-APS=Investment Multiplier.
(D) 1/1- C=Investment Multiplier.
Choose the correct answer from the options given below:
Solution
✅ Correct Option: 4
is MPC (A correct) and is MPS (B correct). The investment multiplier is where is MPC, so (D) is correct. It is not ; the correct saving-based form is , so (C) is incorrect. Hence (A), (B) and (D) only.
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