If the Annual Amount of Savings Is $10 Billion, What

question 22

Multiple Choice

If the annual amount of savings is $10 billion, what is the effect of a wealth tax assuming supply is responsive?

• A)Annual savings remain at $10 billion.
• B)Annual savings increase above $10 billion.
• C)Annual savings fall below $10 billion.
• D)No particular effect is guaranteed to happen.

Recognize how consumption and saving behavior changes with changes in income.

Understand the impact of expectations on consumption.

Examine factors that cause shifts in the consumption function.

Analyze the effects of changes in wealth and interest rates on consumption.

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Definitions:

Unfreezing

The initial phase in the change process where existing patterns or behaviors are dismantled to prepare for the introduction of new methods or ways of functioning.

Driving Forces

Key factors or motivations that influence the direction of change within an individual or organization.

Restraining Forces

Restraining forces are factors that resist or work against change within an organization or system.

Resistance Change

Opposition or pushback against modifications in procedures, policies, or strategies, often due to discomfort with altering the status quo.