A Factor That Limits the Amount of Saving in Developing

question 188

Multiple Choice

A factor that limits the amount of saving in developing countries is the fact that

• A) the banking system does not encourage saving.
• B) there is too much foreign aid, so savings is not needed.
• C) the level of aggregate domestic output is low.
• D) the government controls financial institutions and makes it difficult for people to save.

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Definitions:

External Attribution

The process of inferring that a person's behavior is due to situational factors outside of their control, rather than internal characteristics.

Harold Kelley

A psychologist known for his contributions to social psychology, especially in the areas of attribution theory and the covariance model.

Prisoner's Dilemma

A theoretical game in economics and psychology that illustrates why two individuals might not cooperate, even if it appears that it is in their best interest to do so.

Cooperation

A process where two or more entities work together towards a common goal, often leading to mutual benefit.