Problem
In macroeconomics the average propensity to consume (APC) and the marginal propensity to consume (MPC) are defined as follows:
APC = C/Y where C = consumption, Y = income
MPC = increase in C from a 1 unit increase in Y
Explain why APC will always be greater than MPC if C = 400 + 0.5Y.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.