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The Capital Market and the Investment Decision

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For each of the following, decide whether you agree or disagree and explain your answer:

a. Savings and investment are just two words for the same thing.

b. When I buy a share of Microsoft stock, I have invested; when I buy a government bond, I have not.

c. Higher interest rates lead to more investments because those investments pay a higher return.

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The Capital Market and the Investment Decision are responded to and validated. The explanation is given in 206 words.

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a. Savings and investment are often the same thing. Though I disagree because saving could be putting money under your bed in order to save it for later use. In this case it is not being used to invest in anything. Investment is when you either give money to someone else hoping for a ...

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