If a Country Increases Its Saving Rate, _____

question 64

Multiple Choice

If a country increases its saving rate, _____.

• A)its current consumption decreases
• B)its current consumption increases
• C)its future interest rate increases
• D)its future saving capabilities decreases
• E)its future consumption decreases

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Definitions:

Required Return

The minimum gain needed from an investment to make it worthwhile for the investor, considering the risk associated.

Beta

A measure of a stock's volatility in relation to the overall market; a beta higher than 1 indicates higher volatility than the market, and a beta lower than 1 indicates lower.

Risk-Free Rate

The theoretical rate of return of an investment with zero risk, typically represented by the yield on government bonds.

Intrinsic Value

The actual value of a company or an asset based on underlying perception of its true value including all aspects of the business, in terms of both tangible and intangible factors.