Question

What is saving?

• A. Difference between consumption and saving
• B. Difference between income and consumption
• C. Difference between consumption and production
• D. None of these

Hint:

Formula: Saving = Income – Consumption.

Answer 1

The Correct Option is B

Step 1: Understanding saving.
Saving is the portion of income that is not spent on consumption of goods and services. It is set aside for future use or investment.
Step 2: Analyzing the options.
(A) Difference between consumption and saving: Incorrect definition.
(B) Difference between income and consumption: Correct — saving is income minus consumption expenditure.
(C) Difference between consumption and production: Incorrect.
(D) None of these: Incorrect, since option (B) is correct.
Step 3: Conclusion.
Thus, saving is defined as the difference between income and consumption.