A society which forgoes present consumption:
A)is forced to do so because of excessive consumption within the country in the past.
B)may be devoting new resources to new capital formation.
C)is merely devoting resources to the replacement of capital.
D)expects to consume only that amount tomorrow which was foregone today.
E)does none of the above.

Question

Quizplus · Accepted Answer

A society that forgoes present consumption may be doing so in order to devote resources to new capital formation, which will enable greater consumption in the future. This decision could be driven by the desire to improve standards of living or increase productivity in the long term. It is not necessarily a result of excessive past consumption or merely the replacement of capital. The answer is not D because forgoing present consumption does not necessarily imply a fixed or specific level of consumption in the future.

A Society Which Forgoes Present Consumption