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Q:

Forced saving refers to-

  • 1
    Compulsory deposits imposed on income tax payers
  • 2
    Provident fund contribution of private sector employees
  • 3
    Reduction of consumption consequent to a rise in price
  • 4
    Taxes on individual income and wealth
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Answer : 3. "Reduction of consumption consequent to a rise in price"
Explanation :

According to Nobel Prize winner Frederick Wan, Forced Saving in an economic situation in which consumer spend less than their disposable income, not because they want to save but because the goods they seek are not avoidable or because goods are too expensive.

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