Why Is the Effect of Saving So Controversial to Economists

question 67

Multiple Choice

Why is the effect of saving so controversial to economists?

• A) Increased saving always has an unambiguously positive effect on the economy
• B) Increased saving always has an unambiguously negative effect on the economy
• C) Increased saving may hurt the economy in the short run but help it in the long run
• D) Decreased saving my hurt the economy in the short run but help it in the long run
• E) Because different schools of economic thought use different definitions

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Definitions:

Outstanding Stock

Refers to the total number of shares of a company that are currently owned by investors, including shares held by institutional investors and restricted shares held by insiders and company officers.

Strategic Fit

Alignment between an organization's strategies, capabilities, and the external environment, aiming to achieve competitive advantage.

Discounted Cash Flow

A valuation method used to estimate the attractiveness of an investment opportunity, accounting for the time value of money.

Efficiency Improvement

The process of optimizing operations to increase output, enhance quality, or reduce costs without compromising the end product or service.