Answered

Investment spending:

A. Tends to be volatile.
B. Is the largest component of total spending.
C. Is not sensitive to interest rates.
D. Is limited to the stock and bond markets.



Answer :

GinnyAnswer

Final answer:

Investment spending is a volatile component of GDP, influenced by savings decisions and impacting economic fluctuations.


Explanation:

Investment spending is a highly volatile component of GDP, with year-to-year changes in Gross Private Domestic Investment (GPDI) being greater than changes in consumption or government purchases. Investment represents a choice to postpone consumption, requiring saving and being a significant factor in economic fluctuations.


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