What Is the Difference Between Economic and Financial Investments

question 192

Multiple Choice

What is the difference between economic and financial investments?

• A)Financial investments are sensitive to interest rates; economic investments are not.
• B)Economic investments add to the capital stock of an economy; financial investments do not.
• C)Economic investments are expressed in real (inflation-adjusted) terms; financial investments are expressed in nominal terms.
• D)Financial investments include all purchases undertaken with the expectation of financial gain; economic investments include only purchases of new capital goods.

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