Question

What is an investment what is the importance of investment?

Answer 1

Answer:

Investing ensures present and future long-term financial security. The money generated from your investments can provide financial security and income. One of the ways investments like stocks, bonds, and ETFs provide income is by way of a dividend.

importance of investment:

We can establish the importance of investment in another way also. In order to maintain an equilibrium level of income (Y = C +I), consumption expenditures plus investment expenditures must equal the total income (Y); but according to the Psychological Law of Consumption given by Keynes, as income increases, consumption also increases but by less than the increment in income. This means that a part of the increment in income is not spent i. e. is saved.