The theoretical model of the intertemporal budget constraint suggests that the most important factor in support of individual savings is:
a. the preference of the individual.
b. a higher rate of return on savings.
c. an increase in income.
d. a decrease in the cost of living.
a. the preference of the individual.
The theoretical model of the intertemporal budget constraint suggests that when the rate of return rises, the quantity of saving may rise, fall, or remain the same, depending on the preferences of individuals.
You might also like to view...
During the production process Ajax Corporation releases pollution into the air. Ajax Corporation operates in a monopolistic competitive industry. Which of the following statements addresses the pollution situation?
A) Ajax is taking advantage of asymmetric information. B) This is an example of a market failure and is a reason for the government to regulate the industry. C) The quality of the product could be improved if the amount of pollution can be reduced. D) This is known as the lemons problem.
When output is 100 units, the firm's total fixed cost is $50. What will this firm's total fixed cost be if output doubles to 200 units?
A) $1,000 B) $50 C) $100 D) Can't tell from the information provided.