Which of the following does not meet the economic definition of saving?
A) A graduate assistant spends all of his income on tuition
B) A student deposits money in her savings account
C) A professor spends less than he makes each month
D) The president's secretary puts cash under her mattress

Question

Quizplus · Accepted Answer

Saving, in economic terms, refers to the portion of income not spent on current expenditures. Choices B, C, and D all involve not spending part or all of one's income immediately, thus they are considered saving. However, A involves spending all income on tuition, which is a current expenditure, and therefore does not meet the economic definition of saving.

Which of the Following Does Not Meet the Economic Definition