Which of the two decisions are involved in a savings proposition?

A. Retention of risk and reduced consumption

B. Gifting and accumulation

C. Spending and accumulation

D. Postponement of consumption and parting with liquidity

Answer: Option D

Solution(By Examveda Team)

Postponement of consumption and parting with liquidity are involved in a savings proposition.
Postponement of consumption: an allocation of resources between present and future consumption.
Parting with liquidity (or ready purchasing power) in exchange for less liquid assets. For instance, purchase of a life insurance policy implies exchanging money for a contract which is less liquid.