The economy will expand when:
A)actual GDP is less than potential GDP.
B)planned investment exceeds saving.
C)saving exceeds planned investment.
D)unplanned investment occurs.

Question

Quizplus · Accepted Answer

When planned investment exceeds saving, it indicates that businesses are optimistic about future economic growth and are investing in capital goods to increase their output. This leads to an increase in production and employment, which ultimately results in economic expansion.

The Economy Will Expand When