--%>

Difference between APC and MPC

Differentiate between APC and MPC. The value of which of them can be greater than another and when?

Answer:

APC is the average consumption stage of people. Which is equivalent to = APC = C/Y.
MPC is the addition in consumption due to rise in income that is, MPC = ΔC / ΔY.
APC can be greater than one whenever consumption is more than Income.

   Related Questions in Macroeconomics

  • Q : Explain about the marginalism theory

    Most economists believe such that people increase an activity when they perceive the expected additional benefits as exceeding the expected extra cost, but decrease their level of an activity whenever they believe the benefits from the last few units of the activity a

  • Q : Definition of surplus Definition of

    Definition of surplus: It is a condition in which quantity supplied is more than quantity demanded. To remove the surplus, producers will minimize the price till the market reaches to equilibrium.

  • Q : Principles of macroeconomics what are

    what are the four factor of economic growth

  • Q : Value of MPC Why can be value of MPC be

    Why can be value of MPC be not more than one? Answer: The value of MPC will not be more than one since increment in consumption (ΔC) can’t be more than

  • Q : What is the difference between profit

    What is the difference between profit and producer surplus?

  • Q : MPC What relationship does the MPC bear

    What relationship does the MPC bear to the size of the multiplier? The MPS? What will the multiplier be when the MPS is 0, .4, .6, and 1

  • Q : Physical quality of life index DISCUSS

    DISCUSS the experience of high GNP countries and low GNP with regard to PQLI.

  • Q : Drawback in illustration of

    Illustrations of macroeconomic aggregates would NOT consist of the: (1) tax responsibilities of a family. (2) unemployment rate. (3) level of national income. (4) supply of money. (5) rate of inflation. Can someone

  • Q : Equal Marginal advantage law Assume

    Assume that you receive $18 worth of “jollies” (that is, satisfaction, utility or pleasure) from the very first hole of golf played on a particular day, and that your extra jollies from succeeding holes drops $1 for each and every hole played. You should p

  • Q : Inflation Inflation is frequently

    Inflation is frequently described as "too much money chasing too few goods." Is this a satisfactory definition?