Economics A-Level
Investment
What Investment means in Economics A-Level, as defined for AQA.
Definitions of Investment
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Reference: AQA
Expenditure by firms on capital goods, such as machinery or factories, to increase future productive capacity, acting as an injection into the circular flow of income.
A component of aggregate demand depending on interest rates, business expectations, and corporation tax, referring to firms purchasing physical capital goods.
The purchase of new capital goods by firms to increase productive capacity when they expect sustained demand increases.
Long-term funding provided by the capital market, in contrast with the money market's short-term liquidity.
Topics that use Investment
- The determinants of aggregate demand (AQA A-Level)
- The structure of financial markets and financial (AQA A-Level)
Related terms
- Exchange rates
- Aggregate demand
- Broad money
- Circular flow of income
- Coupon
- Equity
- Equity finance
- Financial intermediation
Using Investment in the exam
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