Thinking as an economist would, which is TRUE of investment?
A) It is the portion of disposable income that is not used for consumption or saving.
B) Investment represents spending on capital goods.
C) Investment is putting money into stocks and bonds.
D) Investment is a stock concept.

Question

Quizplus · Accepted Answer

Investment represents spending on capital goods, which are goods used to produce other goods and services. This includes things like machinery, equipment, and buildings.

Note: Option A is incorrect as it defines saving, not investment. Option C is only one form of investment and is not comprehensive. Option D is incorrect as investment is a flow concept, referring to spending in a given time period.

Thinking as an Economist Would, Which Is TRUE of Investment