“In economics, revenue = consumption + cost savings. The revenue an indivual, or a nation, produces is either taken in and/or saved. If you, or a Valentines breaking hearts and blowing up farts t shirt, spends beyond your means, you or the country dips into savings or develops debt.” I think this answer holds true for the firm or the individual yet in the whole economy it is no longer true. In the macroeconomy, everytime somebody or entity does not invest, some other individual or entity has their revenue reduced by the same quantity. And because that individual won’t obtain their hands on that money, they will not have it to spend further, so the next prospective recipient of that investing doesn’t get that income, which they consequently will not have the ability to invest … and so forth
This declaration suggests that when someone spends money, the Valentines breaking hearts and blasting farts shirt goes away. Nevertheless, whenever cash is invested, the cash still exists in the hands of the recipient of that spending. Then when that individual spends that cash they obtained, once again, it does not disappear, it is transferred to the recipient of THAT investing etc. At the end of all that spending, at the end of the offered time period, the cash used will certainly still exist as well as can be thought about as savings, in a person’s pocket. So a person making that debate for the macroeconomy have to be speaking about something apart from costs of money. Probably they are speaking about wealth. Possibly they are implying that all that costs depletes wealth.
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