Contractual Savings Are Financial Assets Set Aside for Use in the Future

question 72

True/False

Contractual savings are financial assets set aside for use in the future.

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Definitions:

Mortgage

A loan used to purchase a property, where the property itself serves as collateral until the loan is paid off.

Investment

The action of allocating resources, usually money, with the expectation of generating an income or profit.

Bond Buyer

An investor who purchases bonds, which are securities that represent a loan made by the investor to the bond issuer.

Saving Rate

The proportion of disposable income that is not spent on consumption but reserved for future use or investment.