Investment Spending: Boosting Economic Growth

What is considered when businesses purchase the factors of production from households?

A. consumption spending
B. aggregate demand
C. government expenditures
D. investment spending

Final answer:

Investment spending is the term used when businesses purchase the factors of production from households.

Answer:

When businesses purchase the factors of production from households, this is considered investment spending.

Explanation:

Investment spending refers to the purchase of capital goods, such as machinery, equipment, and buildings, that are used in the production process. It is an important component of aggregate demand, which is the total amount of spending in an economy.

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