Average Propensity to Consume (APC) Calculator





Formula

The formula to calculate the Average Propensity to Consume (APC) is:

\[ \text{APC} = \frac{\text{Total Consumption}}{\text{Disposable Income}} \]

Description

The Average Propensity to Consume (APC) measures the fraction of disposable income that is spent on consumption. It is calculated by dividing total consumption by disposable income.

Example Calculation

Let's assume your annual disposable income is $150,000, and your total consumption is $84,500. To calculate APC:

\[ \text{APC} = \frac{84,500}{150,000} = 0.563 \]

Therefore, you consume around 56% of your income.