________ Investment Is More Volatile Than Other Forms of Investment

question 40

Multiple Choice

________ investment is more volatile than other forms of investment spending because this type of investment can be changed relatively quickly.

• A)Business fixed
• B)Inventory
• C)Residential
• D)Capital

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Definitions:

Saving

The portion of income not spent on consumption, often put aside for future use or investment.

Disposable Income

The amount of money an individual or household has available to spend or save after income taxes have been deducted.

Disposable Income

Money that becomes available for household savings and expenditures after income taxes are subtracted.

MPS

Marginal Propensity to Save, which is the proportion of an increase in income that is saved rather than spent on consumption.