Income and Expenditure - Investment Spending
3 important questions on Income and Expenditure - Investment Spending
What do economists believe is the cause for a decline in consumer spending in relation to investment?
They would think that the decline occurs due to a slump in investment spending.
Recessions are even said to occur because of a decline in investment
Recessions are even said to occur because of a decline in investment
What is the difference between actual investment spending and planned investment spending?
planned investment occurs when firms decide how much they are planning spend as compare to how much the actually spend
Actual investment spending is the level of spending that occurs regardless of what is planned investment.
when the actual investment is greater than the planned investment that means their difference is an the extra inventory that is not sold so they would need to produce less decreasing GDP
Actual investment spending is the level of spending that occurs regardless of what is planned investment.
when the actual investment is greater than the planned investment that means their difference is an the extra inventory that is not sold so they would need to produce less decreasing GDP
Planned investment has an extra determinint what is it?
While interest rate and expected future real GDP are the normal determinants of investment, the current level of productivity is also a determinant.
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