Which of the Following Assets Made Up the Largest Fraction

question 17

Multiple Choice

Which of the following assets made up the largest fraction of the portfolios of U.S. households in 1950?

• A)Pension reserves
• B)Equities
• C)Mortgages
• D)U.S. government securities

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Definitions:

Real Interest Rate

The interest rate adjusted for inflation, reflecting the true cost of borrowing and the real yield to lenders or investors.

Investment

The process of spending money to purchase assets with the expectation of generating future profits or income.

Public Saving

The difference between the government's tax revenues and its spending, excluding debt interest.

Tax Revenue

The income that is gained by governments through taxation.