For the following questions refer to Figure 15.3 below.
-Consider Figure 15.3.A possible cause for the fall in the saving rate between 1980 and 2005 is:
A)precautionary saving.
B)consumption smoothing.
C)the changing composition of households' savings portfolios.
D)increasing competition among commercial banks.
E)less access to credit markets.

Question

For the following questions refer to Figure 15.3 below. 
-Consider Figure 15.3.A possible cause for the fall in the saving rate between 1980 and 2005 is:
A)precautionary saving. 
B)consumption smoothing. 
C)the changing composition of households' savings portfolios. 
D)increasing competition among commercial banks. 
E)less access to credit markets.

Quizplus · Accepted Answer

The changing composition of households' savings portfolios is a possible cause for the fall in the saving rate between 1980 and 2005. This could be due to a shift towards investment in riskier assets, such as stocks or real estate, which could reduce the amount of money available for saving. Additionally, households might have reduced their allocation to traditional savings vehicles, such as bank deposits, in favor of other types of investments.

For the Following Questions Refer to Figure 15