Maxwell stress tensor: Difference between revisions

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'''Average propensity to consume (APC)''' is the percentage of income spent. To find the percentage of [[income]] spent, one needs to divide [[Consumption (economics)|consumption]] by income, or
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<math>APC=\frac{C}{Y}</math>.
 
Sometimes, [[disposable income]] is used as the denominator instead, so
<math>APC=\frac{C}{Y-T}</math>,
::: where C is the amount spent, Y is pre-tax income, and T is taxes.
 
The inverse is the [[average propensity to save]] (APS).
 
Average propensity to consume (APC) is the percentage of income people desire to spend.
 
It is key to note that Average Propensity to Consume (APC) is very different from [[Marginal propensity to consume]] (MPC). These two values are often confused.
 
==See also==
*[[Marginal propensity to save]]
*[[Marginal propensity to consume]]
 
 
[[Category:Financial ratios]]
[[Category:Income]]
 
 
{{econometrics-stub}}

Latest revision as of 00:23, 28 July 2014

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