Which of the following have a positive relationship with household saving?
I. the real interest rate
II. disposable income
III. expected future income
A) I, II and III
B) II only
C) II and III
D) I and II

Question

Quizplus · Accepted Answer

The real interest rate and disposable income both have a positive relationship with household saving. Higher real interest rates provide more incentive to save due to better returns, and higher disposable income allows households to save more. Expected future income, however, typically has a negative relationship with saving, as higher expected future income may lead households to save less today.

Which of the Following Have a Positive Relationship with Household