Bob has heard rumors that his employer will be merging with another firm and many employees may lose their jobs, and he wants to be prepared in case he loses his job. If he begins to save more in response to this rumor, it is a ________ reason for saving.
A)life-cycle
B)public
C)private
D)precautionary

Question

Quizplus · Accepted Answer

Precautionary savings occurs because the future is uncertain and households need to prepare for unexpected changes in income and expenses.

Bob Has Heard Rumors That His Employer Will Be Merging