According to Keynes, the primary determinant of a person's saving is
A)the nominal interest rate.
B)the real interest rate.
C)the level of the person's consumption spending.
D)the level of the person's real current income.

Question

Quizplus · Accepted Answer

Keynes argued that saving is primarily influenced by the level of a person's real current income. As income increases, individuals tend to save a larger portion of their income. The level of consumption spending and the interest rate can also influence saving, but they are considered secondary determinants according to Keynes.

According to Keynes, the Primary Determinant of a Person's Saving