APC meaning in Business ?

Answer:

What is Average Propensity to Consume mean?

Average propensity to consume (as well as the marginal propensity to consume) is a concept developed by John Maynard Keynes to analyze the consumption function, which is a formula where total consumption expenditures (C) of a household consist of autonomous consumption (Ca) and income (Y) (or disposable income (YD)) multiplied by marginal propensity to consume (c or MPC). According to Keynes, the individual´s real income determines saving and consumption decisions.

Consumption function: C = C a + c Y {\displaystyle C={C_{a}}+cY}

The average propensity to consume is referred to as the percentage of income spent on goods and services. It is the proportion of income that is consumed and it is calculated by dividing total consumption expenditure (C) by total income (Y):

A P C = C Y = C a Y + c {\displaystyle APC={\frac {C}{Y}}={\frac {C_{a}}{Y}}+c}

It can be also explained as spending on every monetary unit of income.

Moreover Keynes´s theory claims that wealthier people spend less of their income on consumption than less wealthy people. This is caused by autonomous consumption as everyone needs to eat and get dressed, so they buy a certain amount of food and clothes or pay rent, they all spend some amount of money on these necessities. So the ratio is falling with higher income and wealth. This is why it seems like the poor consume more than the rich. But they only need to spent larger amount of their income on consumption because they have less money available.

Average propensity to consume is not as significant as the marginal propensity to consume (MPC) which represents an additional change in consumer spending as a result of an additional change in household income per monetary unit and it is calculated as derivative of consumption function with respect to income (ratio of change in consumption to change in income). It is used for calculating multiplier in aggregate expenditures model.

reference

Full Form	Category
Atari Punk Console	Academic & Science
Asia Pacific College	Academic & Science
Amphenol Precision Connector	Academic & Science
AstroParticle and Cosmology	Academic & Science
Annual Percentage Change	Accounts and Finance
Auditing Practices Committee	Accounts and Finance
Actual Payment Coefficient	Accounts and Finance
Napa (ca)	Airport Code
Association for Progressive Communications	Associations & Organizations
American Pie Council	Associations & Organizations
American Plastics Council	Associations & Organizations
Asian Paralympic Committee	Associations & Organizations
Association of Professional Chaplains	Associations & Organizations
African Paralympic Committee	Associations & Organizations
Apocalypse Production Crew	Associations & Organizations
Anti-Poverty Committee	Associations & Organizations
American Power Conversion	Business
Anadarko Petroleum Corporation	Business
Arab Potash Company	Business
Average Propensity to Consume	Business
Arrangers Publishing Company	Business
Atlantic-Pacific Capital	Business
Advance Payment Certificate	Certifications
Asynchronous Procedure Call	Computer Assembly Language
Analog-to-packet Converter	Computer Hardware
Application Program Command	Computing
Advanced Personal Computer	Computing
Alpha Coin	Cryptocurrency
Angled Polished Connector	Electronics
Automatic Power Control	Electronics
All Pass Crossover	Electronics
Advanced Process Control	Electronics
Advanced Power Calibration	Electronics
Lotus 1-2-3 Printer Driver Characters	File Type
All Progressives Congress	Governmental
Armoured Personnel Carrier	Governmental
All People’s Congress	Governmental
Advanced Police Carbine	Governmental
All Parties Conference	Governmental
Armour-Piercing Capped	Governmental
Army Proficiency Certificate	Governmental
Alien Property Custodian	Governmental
Animal Procedures Committee	Governmental
Alianza Popular Conservadora	Governmental
Alternativa Popular Canaria	Governmental
Alianza Patriótica por el Cambi	Governmental
Ambulatory Payment Classification	Healthcare
Associate Player Character	Jobs
Adenomatous Polyposis Coli	Medical
Allophycocyanin	Medical
Activated Protein C	Medical
Antigen-Presenting Cell	Medical
Anaphase-Promoting Complex	Medical
Argon Plasma Coagulation	Medical
Amino Acid-Polyamine-Organocation	Medical
Aspirin-Phenacetin-Caffeine	Medical
Ambulatory Payment Classifications	Medical
Atrial Premature Complexes	Medical
Average Per Cover	Messaging
All Purpose Capsule	Military and Defence
All Purpose Capsule - Asprin Phen? Caffiene	Military and Defence
Asia/pacific Campaign [ww2]	Military and Defence
Armored Personnel Carrier	Military and Defence
Account Processing Code	Military and Defence
Army Policy Council	Military and Defence
Aerial Port Commander	Military and Defence
Assign Pre-programmed Conference List	Military and Defence
Aviation Performance Center	Military and Defence
Automatic Ping Control	Networking
American Power Conversion (corporation)	Networking
Article Processing Charge	News & Entertainment
Australian Personal Computer	News & Entertainment
Atelier de Production et de Création	Society & Culture
Associated Presbyterian Churches	Society & Culture
Alternative Php Cache	Softwares
Adaptive Payload Carrier	Space Science
Association Professional Cycliste	Sports
Adoptable Player Character	Sports
Associated Player Character	Sports
Active Participation Clause	Sports
Americas Paralympic Committee	Sports
Australian Provincial Championship	Sports & Games
All Purpose Cleaner	Technology
Adaptive Predictive Coding	Technology
Angled Physical Contact	Technology
Automatic Performance Control	Technology
Napa County Airport	Transport & Travel