Why are savings and investment so important for economic growth? How do savings and investment affect present and future consumption? Explain
What will be an ideal response?
Savings and investment are extremely important for economic growth because the amount of economic investment that takes place in an economy is limited to the amount of money available (savings) to fund investment projects. There is then a direct relationship between savings and investment, and present consumption must be sacrificed, in the form of savings, to allow for economic investment to materialize so that larger amounts of output can be produced and consume in the future. This short-run pain but long-run gain is at the root of economic growth.
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A) money as a store of value. B) money as a standard of deferred payment. C) barter. D) money as a medium of exchange.
Rent seeking refers to the asking prices for goods and services being sold on the black market
Indicate whether the statement is true or false