When current savings of an economic unit exceed its direct investment in real assets,
A) more funds are needed by the economic unit
B) funds can be made available to a savings deficit unit
C) interest rates will rise
D) firms have undistributed profits

Question

Quizplus · Accepted Answer

When current savings of an economic unit exceed its direct investment in real assets, it means that the unit has a savings surplus. This surplus can be made available to a savings deficit unit, which can lead to increased investment and economic growth. Thus, choice B is correct. Choices A, C, and D are all incorrect because they do not accurately describe the relationship between savings and investment.

When Current Savings of an Economic Unit Exceed Its Direct