10 terms

APC (in laments' terms)

the ratio of consumption to income

MPC (in laments' terms)

the extra consumption generated by a dollar of extra income

marginal

extra

formula for MPC

ΔC/ΔYd

formula for MPS

ΔS/ΔYd

formula for APC

C/Yd

formula for APS

S/Yd

what is the difference between the APC and the MPC?

APC is how much people (on average) spend out of their annual income. MPC is how much people spend out of changes in income

1- MPC =

MPS

1- APC=

APS