Introduction to Investment
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Questions and Answers

What is the reason for saving according to the text?

  • To have immediate possession of savings for future consumption
  • To trade off present consumption for a higher level of future consumption (correct)
  • To retrieve savings from the mattress when needed
  • To bury money in the backyard for future use

    • What is the main purpose of investment as per the text?

  • To consume more than current income
  • To have immediate possession of savings
  • To make savings increase over time (correct)
  • To defer consumption

    • What do people tend to do when their current income exceeds current consumption desires?

  • Save the excess (correct)
  • Invest the excess
  • Borrow more money
  • Spend the excess immediately

    • What happens when people retrieve their savings from the mattress or backyard according to the text?

    <p>They have the same amount they saved</p> Signup and view all the answers

    What do those who give up immediate possession of savings expect according to the text?

    <p>To receive in the future a greater amount than they gave up</p> Signup and view all the answers

    What is the reason for saving according to the text?

    <p>To trade present consumption for a higher level of future consumption</p> Signup and view all the answers

    What do people tend to do when their current income exceeds current consumption desires?

    <p>Save the excess</p> Signup and view all the answers

    What happens when people retrieve their savings from the mattress or backyard according to the text?

    <p>They have the same amount they saved</p> Signup and view all the answers

    What do those who give up immediate possession of savings expect according to the text?

    <p>To receive in the future a greater amount than they gave up</p> Signup and view all the answers

    What is investment according to the text?

    <p>Making savings increase over time</p> Signup and view all the answers

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