ECONOMICS
AGGREGATE DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Concerns with future income and job security
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Increased taxation on saving
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Consumers requiring smaller deposits to buy a house.
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Reduced availability of saving institutions
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Detailed explanation-1: -Economic conditions such as economic stability and total income are important in determining savings rates. Periods of high economic uncertainty, such as recessions and economic shocks, tend to induce an increase in the savings rate as people defer current spending to prepare for an uncertain economic future.
Detailed explanation-2: -Greater availability of credit results in lower interest rates. This stimulates more firms and individuals to invest, as they can now borrow money for their investment at a lower interest rate. Ultimately, the more savings there are, the more investment there is in the economy.
Detailed explanation-3: -– Demographic factors: age, gender, incomes and wealth, education level, children, housing ownership, etc. – Other factors: valuation of previous experience as investor, aims to invest/saving, top barriers mentioned to invest, etc.
Detailed explanation-4: -Track Your Spending. Live Within Your Means. Don’t Borrow to Finance a Lifestyle. Set Short-Term Goals. Become Financially Literate. Save What You Can for Retirement. Don’t Leave Money on the Table. Take Calculated Risks. More items