In 2000s, Low Savings Rates Are Attributed To

question 21

Multiple Choice

In 2000s, low savings rates are attributed to:

• A) Rapid economic growth.
• B) Stock market boom.
• C) Declining interest rates and increased refinancing of the mortgages.
• D) Inefficient monetary policy.

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Definitions:

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, which often leads to a reduced cost per unit of output.

Diseconomies of Scope

A situation in which a single firm producing multiple products has higher costs than if each product were produced by a separate firm.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, which often leads to a reduction in average cost per unit as scale is increased.

Economies of Scope

Cost advantages that a business experiences by expanding the variety of products or services it offers, leveraging shared operations or resources.