Question

After a report that saving in the united states is at an all time low, jeopardizing many family's retirement plans, americans begin to save in an effort to ensure they are not the ones without the ability to retire. explain the impact on economic growth.

Answer 1

Savings usually have positive impacts on economic growth of a nation. Firstly, increase in the amount of money saved increase the amount of money that are available in the banks which can be used for investment purposes that will benefit the economy. Secondly, high saving rate in an economy increases the ability of that economy to recover from inflation and recession. Personally and nationally, saving helps to cope better with economic and financial down turns.