Statement A: As disposable income goes up, the APC falls but APS increases. Statement B: As disposable income goes up, the MPC falls but MPS increases. Refer to the statement above. Which of the following is correct? O 1) the Statement A is correct. 2) the Statement B is correct. 3) Both Statement A and B are correct. O 4) Neither Statement A nor Statement B is correct.

Statement A: As disposable income goes up, the APC falls but APS increases. Statement B: As disposable income goes up, the MPC falls but MPS increases. Refer to the statement above. Which of the following is correct? O 1) the Statement A is correct. 2) the Statement B is correct. 3) Both Statement A and B are correct. O 4) Neither Statement A nor Statement B is correct.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter23: The Aggregate Expenditure Model

Section: Chapter Questions

Problem 6P

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