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Higher incomes in middle age are associated with higher savings ratios to finance consumer expenditures in retirement
Higher incomes in middle age are associated with higher savings ratios to finance consumer expenditures in retirement. Select one: False During the 1980's period, the conventional money demand function overpredicted the level of money demand Select one False
According to James Tobin's modification of Keynes' theory of money demand as a store of wealth a the demand for money arises because it yields a high return. b the demand for money occurs because money is a risky asset c the demand for money is explained as aversion to risk d all of the above.
As national Income increases Select one a The average propensity to consume Increases and diverges in value from the marginal propensity to consume b The average propensity to consume always approaches infinity c.The average propensity to consume falls and gets nearer in value to the marginal propensity to consume d The average propensity to consume stays constant
Expert Solution
1). As we know that people generally save at their middle age when there is flow of more income, they generally save to meet the expenditure in future after their retirement.
The correct option is (True).
2). The correct option is (true).
During the period of 1980 the demand for money was less than the conventional demand function of money.
3). The correct option is (d).
All of the above are correct.
Money is Considered one of the most liquid asset. It is also having higher risk and return associated with it.
4). The correct option is (c).
When national income increases the result is that APC falls but at a rate less than MPC.
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