Question : Which of the following statement are true?
- Average propensity to save can never be negative.
- Higher the level of national income, higher is the level of autonomous consumption.
Option 1: Both are true.
Option 2: Both are false.
Option 3: Statement 1 is true, statement 2 is false.
Option 4: Statement 1 is false, statement 2 is true.
Answer (1)
24th Jan, 2024
Correct Answer:
Statement 1 is true, statement 2 is false.
Solution :
Average propensity to save can be negative when consumption expenditure is greater than income.
Autonomous consumption is an independent factors which is not related to the level of income.
Hence, Option C is correct.
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