Which of the following is a feature of the 'Save More Tomorrow' programme designed by Thaler and Benartzi?
A. A commitment device that allows employees to pre-commit to allocating a portion of future salary increases to retirement savings
B. An immediate large increase in current contributions
C. A mandatory increase in taxes
D. A programme that ignores behavioural biases
Answer: Option A
Solution (By JKSSB Mock Tests)
Save More Tomorrow is a behavioural intervention that invites employees to commit in advance to increasing their retirement contribution rates whenever they receive pay raises, thereby overcoming present bias and inertia.
Explanation:
GST replaced multiple cascading taxes with a unified tax on the supply of goods and services, allowing input tax credit and involving both the Centre and the States.
Explanation:
Present bias describes the common tendency for people to place disproportionately greater weight on immediate rewards relative to delayed rewards, leading to time-inconsistent preferences and self-control problems.
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