The Saving Function Shows a ________ Relationship Between ________

question 437

Multiple Choice

The saving function shows a ________ relationship between ________.

• A) positive; disposable income and saving
• B) positive; disposable income and dissaving
• C) negative; disposable income and consumption expenditure
• D) negative; real GDP and saving

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Definitions:

Compounded Annually

Describes the process of calculating interest on both the initial principal and the accumulated interest from previous periods once a year.

Present Value

The present value of a future amount of money or series of cash flows using a predetermined rate of return.

Perpetuity

A financial term for a stream of cash payments that continue indefinitely.

Semi-Annually

A term indicating something occurs twice a year.