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investment is part of output, so if we have a low investment, we will have a lower GDP holding all other factors constant.

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Q: Why is investment so important to GDP?
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Related questions

Are mutual funds an investment or saving?

for GDP an investment is saving.


How does gold investment affects GDP?

Investment in Gold reduces supply of money needed for accelation in economic growth. To that extent that affects growth of GDP.


What resulted in the increase of GDP?

Greater levels of investment


How does investment in Capital affect china's GDP?

Basically, GDP=AE=Y where AE is aggregate expenditure and Y is income. Y=C+I+G+(X-M) C is consumption, I is investment, G is government spending, X is exports and M is imports. So increased investment can lead to increased GDP. In a bit more detail: I can be broken down into: Investment=I0 - bi where I0 is 'autonomous' investment (as in firms will do it nor matter what). i is the interest rate and b is the marginal propensity to invest. So, as interest rates increase, the cost of investing increases and so investment decreases.


How is GDP calculated using the expenditures approach?

GDP = Consumption + Investment + Government Purchases + Net Exports


Why must saving equal planned investment at equilibrium GDP in the private closed economy?

Saving must equal planned investment at equilibrium GDP in the private closed economy because leaking of saving that exceeds the injection of investment causes a level of GDP that cannot be sustained. Having a leaking of saving that is lower than the injection of investment causes the GDP to drive upward. In either case is bad to not have them at equilibrium.


What would result in increase in GDP?

Greater levels of investment


What is the relationship between investment in human capital and GDP?

teeth


Exports have the same effect on the current size of GDP as?

Investment


How does an investment in human capital and capital goods affect GDP?

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Which of these would not be considered a private investment when calculating the GDP?

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IF GDP is 6000net investment is 200Goernment Purchaser is 1100Gross investment is 800Consumption is 4000 and Government budget surplus is 30 then find the NDP?

If GDP is $6000,net investment is $200,Government Purchaser is $1100,Gross investment is $800,Consumption is $4000 and Government budget surplus is $30 then find the NDP