Average Propensity to Consume (APC) Calculator
Calculate the fraction of total income that households spend on consumption goods and services.
How to use this tool
- Enter total consumption (c) and total income (y) in the fields above.
- Results update instantly as you type — or click Calculate.
- Read your average propensity to consume (apc) and the full breakdown beneath it.
Formula
APC = C / Y
APS = 1 − APC = S / Y
where C = total consumption expenditure, Y = total income, S = savings.
How it works
The Average Propensity to Consume measures the share of income devoted to consumption at a given income level, and always sums to 1 with the Average Propensity to Save (APS). An APC greater than 1 implies dissaving (households are spending more than they earn by drawing on savings or borrowing). This calculator uses total (gross) income and total consumption spending.
Worked example
Household earning $50,000 spending $40,000
- Total income Y = $50,000
- Total consumption C = $40,000
- APC = C / Y = 40,000 / 50,000 = 0.80
- APS = 1 − APC = 1 − 0.80 = 0.20
APC = 0.80 (80% of income is consumed; 20% is saved)
Key terms
- Average Propensity to Consume (APC)
- The ratio of total consumption to total income; measures what fraction of income is spent rather than saved.
- Average Propensity to Save (APS)
- The ratio of total savings to total income; equals 1 − APC.
- Dissaving
- Spending in excess of income, requiring borrowing or drawing down accumulated savings (APC > 1).
- Marginal Propensity to Consume (MPC)
- The fraction of an additional dollar of income that is consumed, distinct from the average figure.