Savings are defined as disposable income not spent for consumer goods.

Savings are defined as disposable income not spent for consumer goods.

• A. Personal Income
• B. Liquid Assets
• C. Savings
• D. Income Expectations

Answer: (C)

Savings is the portion of disposable income that isn’t spent on consumer goods or services. After taxes, the money you have left can be used for immediate purchases or set aside for future use; savings specifically refers to the amount you choose to set aside rather than spend now. Personal income describes total earnings before deciding how to spend or save, so it’s about how much you earn, not what you do with it. Liquid assets are types of resources that can be quickly converted to cash, not the act of saving itself. Income expectations are beliefs about future earnings and can influence saving habits, but they aren’t savings.

Savings is the portion of disposable income that isn’t spent on consumer goods or services. After taxes, the money you have left can be used for immediate purchases or set aside for future use; savings specifically refers to the amount you choose to set aside rather than spend now. Personal income describes total earnings before deciding how to spend or save, so it’s about how much you earn, not what you do with it. Liquid assets are types of resources that can be quickly converted to cash, not the act of saving itself. Income expectations are beliefs about future earnings and can influence saving habits, but they aren’t savings.