Briefly explain how the miserliness of Ebenezer Scrooge might actually be beneficial for economic growth
What will be an ideal response?
Ebenezer Scrooge is known for his unwillingness to spend money. Refusing to use his money for consumption spending, Scrooge saves his money instead. This saving then becomes available for firms to borrow to finance the building of new factories or research and development. Since growth in the capital stock and technological advance are keys to economic growth, the "stingy" Scrooge may actually promote economic growth.
You might also like to view...
In a perfectly competitive market the term "price taker" applies to
A) sellers but not buyers. B) only the smallest sellers and buyers. C) buyers but not sellers. D) sellers and buyers.
Suppose we have the following information about a furniture maker: furniture sales $100M, wood purchases $60M, wages $25M, tax on profits $5M, profits $10M. What is the contribution to GDP of this company using the product approach?
A) $100M. B) $60M. C) $40M. D) $15M.