The funds that firms use to buy capital come directly or indirectly from households.

Name: The funds that firms use to buy capital come directly or indirectly from households.
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Question

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Households save money in banks or invest in stocks and bonds, which in turn provide the funds that firms use to buy capital. This process can be direct, through purchasing stocks or bonds issued by firms, or indirect, through saving money in banks that then lend to firms.

The Funds That Firms Use to Buy Capital Come Directly