One of the primary determinants of planned real investment spending is the
A)expectation of future profits.
B)rate of real consumption spending.
C)rate of real government spending.
D)rate of real saving.

Question

Quizplus · Accepted Answer

Planned real investment spending depends heavily on the expectation of future profits. Firms are more likely to invest in new projects and expand their businesses if they anticipate higher future profits, indicating a positive outlook on the economy. Factors such as technological advancements, changes in government policies, and shifts in consumer preferences also influence the expectation of future profits and consequently impact planned investment spending. Real consumption spending, government spending, and saving rates are important economic indicators but have a weaker association with investment spending compared to future profit expectations.

One of the Primary Determinants of Planned Real Investment Spending