What the term average propensity to consume means in the, Financial Management

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What the term average propensity to consume means in the

1. In Your Own Words explain what the term Average Propensity to Consume means in the world of financial planning.

2. Suppose you take a 30 year fixed-rate mortgage for $175,000 at 5.50%, monthly payments with a two discount point rebate (negative discount points) to the borrower. Assume that you have no other financing fees.

A. What is the APR of the loan?

B. What is the effective cost with a five-year holding period?

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Financial Management: What the term average propensity to consume means in the

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