The Three Major Risk Reduction Strategies Discussed in the Text

question 30

True/False

The three major risk reduction strategies discussed in the text are narrow scope,broad scope and imitation. 

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Definitions:

Private Investment

The expenditure on capital goods by private sector firms or individuals to increase their production capacity or asset portfolio.

Government Spending

The total amount of money spent by the government on various services and projects, including education, defense, infrastructure, and welfare programs.

Crowding-Out Effect

Describes a situation in economics where increased public sector spending reduces or eliminates private sector spending, often due to higher interest rates or borrowed funds.

Private Saving

The portion of individual or household income that is not spent on consumption but saved for future use.