if the government wants to encourage people to save more, would a policy of higher interest rates always achieve this objective? explain using the concept of indifference curve.
Answers
Answer:
government have a strong interest in the savings and investment in an economy.
both saving and investment affect the overall economy.
there are a number of way in through which a government can incentivize savings and investment.
Answer:
Explanation:
Monetary policies lower interest rates to encourage savings by borrowing them, which encourages investment. Such industries, in which the government wants to encourage investment, they are are given tax breaks by the government to encourage them to investment more. When governments want to encourage savings, sometimes they can also create certain types of savings tax exempt.
An indifference curve is used to show a combination of two goods that give the consumers equal satisfaction as well as utility making the consumer indifferent.