Which of the following influences household saving?
I. The real interest rate.
II. Disposable income.
III. Expected future income.

Question

Quizplus · Accepted Answer

All three factors listed (real interest rate, disposable income, and expected future income) can influence household saving. Higher real interest rates can encourage saving by offering a higher return on savings, while higher disposable income can either encourage saving (if the income increase is saved) or discourage saving (if the income increase is spent). Expected future income can also influence saving, as individuals may choose to save more in anticipation of future income fluctuations or uncertainty. Therefore, all three factors can affect household saving, making D the correct choice.

Which of the Following Influences Household Saving