Other Things Being Constant, Countries with Higher Rates of Saving

question 90

Multiple Choice

Other things being constant, countries with higher rates of saving

• A) will have smaller GDPs than countries with lower rates of saving.
• B) will have higher rates of investment, but slower growth.
• C) will have higher rates of investment and growth.
• D) will be operating at less than full employment and potential output.

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Definitions:

Hermann Ebbinghaus

A German psychologist who is best known for his research on memory and the forgetting curve.

Sensory Storage

The shortest-term element of memory, which allows the retention of impressions of sensory information after the original stimuli have ended.

Constructive Processing

The way in which our memory reconstructs past events, often influenced by current knowledge, feelings, and thoughts.

Hindsight Bias

The tendency to believe, after learning an outcome, that one would have foreseen it, often referred to as the "I knew it all along" effect.