Question : Which of the following statement are true?
- When consumption function is C=50+0.6Y, consumption is 140 when Y= 150.
- When Saving function is S= -50+0.4Y, savings is 10 when Y= 150.
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)
18th Jan, 2024
Correct Answer:
Both are true.
Solution :
APC is more than 1 before break-even point.
C=50+0.6(150)
C= 140
S=-50+0.4(150)
S= 10
Hence, Option A is correct.
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