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Question 3 - CBSE Class 12 Sample Paper for 2022 Boards [Term 2] - Economics - Solutions to CBSE Sample Paper - Economics Class 12

Last updated at March 29, 2023 by

‘As the income increases, people tend to save more’. Justify the given statement.

(2 Marks)

Answer

When people are at a lower level of income, they spend a major part of their income as consumption expenditure for basic consumption

However, as the income increases their consumption levels go down, they become rational and start saving more.

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CA Maninder Singh is a Chartered Accountant for the past 13 years and a teacher from the past 17 years. He teaches Science, Economics, Accounting and English at Teachoo