10.5.a-c - c If the ACP and the APS change when the levels...

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Macroeconomics 9:00 MWF Chapter 10 Key Question 5 Level of Output and Income Consumption Saving APC APS MPC MPS 240 244 -4 1.01 -0.01 0.8 0.2 260 260 0 1 0 0.8 0.2 280 276 4 0.98 0.01 0.8 0.2 300 292 8 0.97 0.02 0.8 0.2 320 308 12 0.96 0.03 0.8 0.2 340 324 16 0.95 0.04 0.8 0.2 360 340 20 0.94 0.05 0.8 0.2 380 356 24 0.93 0.06 0.8 0.2 400 375 28 0.93 0.07 0.8 0.2 a. b. The break-even level is line number two. The way households of low income levels dissave is by liquidating their accumulated wealth or by borrowing.
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Unformatted text preview: c. If the ACP and the APS change when the levels of income consumed and the amount that is saved the reason the MPC and the MPS is constant is because both are rations that are assumed not to change since the user would spend, consume and save the same ratio no matter if his level of output and income changes. Consuming spending saving...
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