Fixed investment is
A) when a firm adds to its inventories of goods.
B) when a firm accumulates profits.
C) dissavings.
D) an expenditure by firms on new machines that are expected to produce income in the future.

Question

Quizplus · Accepted Answer

Fixed investment is an expenditure by firms on new machines, buildings, or other forms of capital that are expected to generate income in the future. It is a long-term investment aimed at boosting the productive capacity of the firm and increasing its profitability over time. Fixed investment is crucial for economic growth as it enables firms to expand their operations, improve efficiency, and create new employment opportunities.

Fixed Investment Is