Income rises when desired investment is
A) greater than desired savings.
B) less than desired savings.
C) equal to desired savings.
D) less than required investment.

Question

Quizplus · Accepted Answer

When desired investment is greater than desired savings, it means that people are willing to invest more than what they are saving which leads to an increase in the demand for funds. This causes interest rates to rise which in turn increases the income levels in the economy.

Income Rises When Desired Investment Is