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Question 1, The meaning of investment is different for economists. Explain Question 2, Use an aggregate supply-and-demand...
Question 1, The meaning of investment is different for economists. Explain
Question 2, Use an aggregate supply-and-demand diagram to study what would happen to an economy in which the aggregate supply curve never moved while the aggregate demand curve shifted outward year after year
Homework Answers
Answer #1
1. In economics, an investment is the purchase of goods that are not consumed today but used to create wealth in the future. On the other hand, In finance, an investment is a monetary asset that is purchased with an idea that it will provide income in the future or it will be sold at a higher price which generate profit.
2. When aggregate demand curve shifts rightwards without change in aggregate supply curve then there will be inflation in the economy because rightward shift of AD curve causes increase in price level and output.
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