Which of the Following Statements Is True

question 155

Multiple Choice

Which of the following statements is true?

• A) An extremely high saving rate can be counterproductive for an economy.
• B) The greater the saving rate in an economy, the slower the rate of physical capital accumulation.
• C) For positive growth, the consumption in an economy should always be less than the saving.
• D) The greater the consumption expenditure in an economy, the faster the physical capital accumulation.

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Definitions:

Settlement Amount

A financial sum agreed upon by parties in a contract, often referring to the resolution amount in disputes or the completion payment in transactions.

Retained Earnings

The portion of net earnings not paid out as dividends but retained by the company to be reinvested in its core business or to pay debt.

Income Statement

A financial statement that shows a company’s revenues, expenses, and profits or losses over a specific period of time.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting its liabilities, representing ownership interest.