Which of the Following Investments Is Not Likely to Be

question 136

Multiple Choice

Which of the following investments is not likely to be a proper investment for temporarily idle cash?

• A) Commercial paper.
• B) Treasury bills.
• C) Recently issued long-term corporate bonds.
• D) Government bonds due shortly.
• E) AT&T bonds due within one year.

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Definitions:

Saving

The act of setting aside a portion of current income for future use, or the portion of income not spent on current expenditures.

MPC (Marginal Propensity to Consume)

The proportion of additional income that is spent on consumption.

Saving

The act of setting aside money for future use instead of spending it immediately.

Disposable Income

The capital households have to spend and save once income taxes have been cleared.