Aplia ch 13 3. The meaning of saving and investment Classify each of the following based...

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Question

Aplia ch 13

3. The meaning of saving and investment

Classify each of the following based on the macroeconomic definitions of saving and investment.

	Saving	Investment
Susan purchases stock in Pherk, a pharmaceutical company.
Megan buys new bulldozers for her construction firm.
Larry purchases a certificate of deposit at his bank.
Raphael takes out a mortgage for a new home in Detroit.

Answer 1

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Answer #1

1. Saving. Herein, only a transfer of funds occurs, and no real investment is yet made.

2. Investment. A firm has bought capital goods

3. Saving. Only a transfer of funds has occurred. No capital has been bought.

4. Investment. A household has bought a new house. This comes under-investment, more specifically, residential investment.

Answer 2

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