The best way to achieve economic growth is to ?
Correct answer: C. save more
- A. increase government spending
- B. reduce taxation
- C. save more
- D. increase personal consumption
Explanation
Higher saving increases the funds available for investment in capital, which expands productive capacity and supports economic growth. Government spending or lower taxes may help growth in some circumstances, but neither guarantees that resources will be directed toward investment.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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