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Topics

Investment

An economist would define investment as the acquisition of goods that are not consumed in the current period, but are used in the future to produce other goods and services. Investment can take many forms, including the purchase of physical capital, such as machinery, equipment, new hardware and software and buildings.

Economists view investment as a key driver of economic growth, as it allows businesses and individuals to increase their productive capacity and to generate future income. Investment can also lead to technological advances and increased efficiency, as businesses may invest in new technologies and equipment in order to improve their operations.

In economic analysis, investment is typically measured as a percentage of gross domestic product (GDP). This allows economists to track changes in investment over time and to compare the level of investment in different countries or regions.

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