ECONOMICS
MONEY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Increased spending
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Increased use of credit
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Cashing out investments
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Decline in savings and investments
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Detailed explanation-1: -Options, stocks, and bonds can also generate investment income. Whether through regular interest or dividend payments or by selling a security at a higher price than was paid.
Detailed explanation-2: -The increase in net income leads to the growth of the company. When net investment rises, the capacity of production also tends to rise in the company. The capital stock and the depreciation of the company increase when there is an increase in net investment.
Detailed explanation-3: -Investment is a component of aggregate demand (AD). Therefore, if there is an increase in investment, it will help to boost AD and short-run economic growth. If there is spare capacity, then increased investment and a rise in AD will increase the rate of economic growth.
Detailed explanation-4: -Given these two variables, one can determine the aggregate demand. The IS curve is downward sloping. When the interest rate falls, investment demand increases, and this increase causes a multiplier effect on consumption, so national income and product rises.