When people expect their income to be lower in the future, they will be:
A. more inclined to save.
B. less inclined to save.
C. unaffected in their present choices.
D. People only react and change their savings decisions based on recent history.
A. more inclined to save.
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________ consumption is consumption that does not depend upon the level of GDP.
A) Autonomous B) Induced C) Voluntary D) Disposable
Refer to Table 17.1. The unemployment rate for this simple economy is
A) 6%. B) 10%. C) 20%. D) 25%.
In the simple deposit expansion model, a decline in checkable deposits of $1,000 when the required reserve ratio is equal to 10 percent implies that the Fed
A) sold $1,000 in government bonds. B) sold $100 in government bonds. C) purchased $1,000 in government bonds. D) purchased $100 in government bonds.
As a last resort the federal government may provide direct income support to farmers. One potential advantage of direct income supports is that they
A. Raise market prices. B. Provide income security without distorting market prices and output. C. Increase market output. D. Reduce consumption.