Which of the following would is included as Investment Spending in aggregate demand?
A)Sandra finances her business from the sale of $200,000 of treasury securities.
B)Marco buys a new building off the Santa Monica coast for his startup.
C)Maria purchases $100,000 of foreign bonds.
D)Allen sells the old truck he used for transporting goods.

Question

Quizplus · Accepted Answer

Investment spending is the purchase of new physical capital such as buildings, equipment, and machinery that is used to produce goods and services. Marco's purchase of a new building would be considered investment spending. The sale of treasury securities by Sandra and the purchase of foreign bonds by Maria are examples of financial investments, which are not included in investment spending. The sale of Allen's old truck is not an investment, it is a sale of an existing asset.

Which of the Following Would Is Included as Investment Spending