When Consumption Spending Is Greater Than Disposable Income, We Know

question 206

Multiple Choice

When consumption spending is greater than disposable income, we know with certainty that we have

• A)dissaving.
• B)excess thrift.
• C)positive savings.
• D)negative net investment.

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Definitions:

RRSP

Registered Retirement Savings Plan, a savings and investment vehicle for Canadians to save for retirement in a tax-efficient way.

Compounded Rate

The rate at which interest is calculated on the initial principal and the accumulated interest of previous periods.

Compounded Monthly

The calculation of interest on both the initial principal and the accumulated interest from previous months.

Monthly Payments

Payments that are due every month, as in the case of a loan or lease.