Keynes' Theory of Consumption Predicts That the Aggregate Saving Rate

question 100

Multiple Choice

Keynes' theory of consumption predicts that the aggregate saving rate

• A)increases as society becomes richer.
• B)falls as society becomes richer.
• C)is constant in the long-run.
• D)falls with higher incomes in a cross-section of income.

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Definitions:

Affiliation Needs

The human desire to belong to a group, feel connected, and maintain social relationships.

Hospitalized

The state of being admitted to a hospital for treatment that cannot be provided on an outpatient basis.

Pneumonia

An infection that inflames the air sacs in one or both lungs, which may fill with fluid or pus, leading to breathing difficulties.

Methodical

Characterized by a systematic, orderly approach often employed in processes or investigations to achieve specific objectives.