Investment spending refers to:?

Question

A) buying stocks.

B) buying newly issued shares of stock.

C) adding to physical capital.

D) adding to one's retirement account.

Answer 1

All of the above. Investment is defined as an expenditure which can reasonably be expected to be recovered with a gain.

If you look at it on an aggregate level, buying stocks from someone else doesn't increase investment because your increase equals someone else's decrease. The same would be true for C and D if the physical capital you're adding is physical capital someone else is subtracting and depending on what your retirement account invests your money in.

Answer 2

C) adding to physical capital.