Question : Which of the following statement are true? APC is more than 1 before break-even point. The point at which consumption curve intersect the 45 degree line, APS is zero. Option 1: Both are true. Option 2: Both are false. Option 3: Statement 1 is true, statem ...

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Question : Which of the following statement are true?

APC is more than 1 before break-even point.

The point at which consumption curve intersect the 45 degree line, APS is zero.

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.

Team Careers360 2nd Jan, 2024

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Answer (1)

Team Careers360 19th Jan, 2024

Correct Answer: Both are true.

Solution : APC is more than 1 before break-even point.
The point at which consumption curve intersect the 45 degree line, APS is zero. It happens because at this point, consumption is equal to income & savings is zero.
Hence, Option A is correct.

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