📚 Learning Guide
Investment Spending and GDP Change
easy

Investment spending is to GDP growth as a seed is to what?

Master this concept with our detailed explanation and step-by-step learning approach

Learning Path
Learning Path

Question & Answer
1
Understand Question
2
Review Options
3
Learn Explanation
4
Explore Topic

Choose the Best Answer

A

A tree's growth

B

Soil fertility

C

Weather conditions

D

A gardener's tools

Understanding the Answer

Let's break down why this is correct

Answer

Investment spending is important for GDP growth because it acts like a seed that helps the economy grow over time. Just as a seed needs water, sunlight, and care to grow into a strong plant, investment spending requires resources and time to develop into a thriving economy. When businesses invest in new equipment or projects, they create jobs and increase production, which leads to higher GDP. For example, if a company builds a new factory, it not only creates jobs but also boosts the local economy as more people earn money and spend it. Therefore, investment spending is the starting point, like a seed, that can lead to larger economic growth in the future.

Detailed Explanation

Investment spending helps the economy grow, just like a seed helps a tree grow. Other options are incorrect because Some might think soil fertility is the main thing for growth; Weather conditions are important, but they are not the starting point.

Key Concepts

Investment Spending
GDP Change
Multiplier Effect
Topic

Investment Spending and GDP Change

Difficulty

easy level question

Cognitive Level

understand

Ready to Master More Topics?

Join thousands of students using Seekh's interactive learning platform to excel in their studies with personalized practice and detailed explanations.