(A) “Income of an economy increased from ₹ 20,000 to ₹ 50,000 crore. Savings of the economy increased from ₹ 2,000 crore to ₹ 10,000 crore.” (i)…

(A)(i)

Income (Y) (in ₹ crore)	Savings (S) (in ₹ crore)	Consumption (C = Y − S) (in ₹ crore)	APC (C/Y)	APS (S/Y)
$\displaystyle 20,000$	$\displaystyle 2,000$	$\displaystyle 18,000$	$\displaystyle \frac{18000}{20000} = 0.9$	$\displaystyle \frac{2000}{20000} = 0.1$
$\displaystyle 50,000$	$\displaystyle 10,000$	$\displaystyle 40,000$	$\displaystyle \frac{40000}{50000} = 0.8$	$\displaystyle \frac{10000}{50000} = 0.2$

From the given data, it can be concluded that as income increases from ₹ $\displaystyle 20,000$ to ₹ $\displaystyle 50,000$ crore, value of Average Propensity to Consume (APC) falls from $\displaystyle 0.9$ to $\displaystyle 0.8$, thereby establishing an inverse relationship between the level of income and APC.

(B)(i) The type of consumption indicated in the above paragraph is Autonomous Consumption.

Autonomous Consumption is independent of level of income. Autonomous Consumption signifies the minimum level of consumption which is essential for survival.

Aggregate Demand (AD) is the sum of consumption and investment. Based on the assumption that, investment is autonomous, thereby, when income rises, consumption also rises, which leads to a rise in Aggregate Demand. Hence, Aggregate Demand curve slopes upward, reflecting a direct relationship between income and Aggregate Demand.