How Can Actual Investment Be Greater Than Desired Investment,and What

question 18

Essay

How can actual investment be greater than desired investment,and what type of gap is the economy experiencing when this occurs?

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Definitions:

Centrally Planned Economies

Economies in which the government makes all decisions about the production and distribution of goods and services.

Production Targets

Objectives set by a company to manufacture and produce a certain amount of goods within a specific timeframe.

Circular Flow Model

An economic model illustrating the flow of goods, services, and funds between households and firms in an economy.

Resource Market

A market where primary factors of production such as labor, capital, and natural resources are bought and sold.