Investment spending is
A) less volatile than consumption spending.
B) much more volatile than consumption spending.
C) equally as volatile as government spending.
D) equally volatile as GDP.
E) is a larger fraction of GDP than consumption is.

Question

Quizplus · Accepted Answer

Investment spending is generally more volatile than consumption spending as it is influenced by factors such as business confidence, interest rates, and expected future profits. Consumption spending, on the other hand, is more stable as it is driven by households' income and consumption patterns.

Investment Spending Is