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Which would be considered an investment according to economists?Multiple Choicethe buying of shares of Janus mutual fundsthe purchase of a new machine by Fordthe purchase of stock in MacDonald'sthe selling of IBM corporate bonds

Question

Which would be considered an investment according to economists?Multiple Choicethe buying of shares of Janus mutual fundsthe purchase of a new machine by Fordthe purchase of stock in MacDonald'sthe selling of IBM corporate bonds

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Solution

All of the following options can be considered as an investment according to economists:

  1. The buying of shares of Janus mutual funds: This is an investment because you are putting money into a financial asset with the expectation that it will provide income or grow in value over time.

  2. The purchase of a new machine by Ford: This is an investment because Ford is spending money on a capital good (the machine) that will be used to produce goods or services and generate income in the future.

  3. The purchase of stock in MacDonald's: Similar to the first option, this is an investment because you are buying a financial asset that you expect to provide income or increase in value.

  4. The selling of IBM corporate bonds: This might seem like a trick option because it involves selling rather than buying. However, it can still be considered an investment. If you originally bought the bonds with the expectation that they would provide income over time, then selling them is simply the final step in that investment. You might be selling them now because you believe it's the right time to cash in on the investment, or because you want to invest the money elsewhere.

So, all of these options can be considered investments according to economists.

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