Question

10. Problems and Applications Q10 Suppose Americans decide to save more of their incomes, providing banks with more funds to lend to businesses for investment. This allows for faster growth in , thereby the overall standard of living. Workers will from the change in productivity growth because they will produce and earn . True or False: Society can receive a "free lunch" when it builds new factories. True False

Answer 1

Answer:True

Explanation: figuratively, society receives free lunch when it build facories ,meaning that at little or no cost ,the society will benefit from the investment.

An affinity for savings couple with will power of banks to lend to thre investors particularly the industrialist will surely bring about an industrial revolution which will improve the quality and quantity of factories .this will provide the society with more jobs and simultaneously reduces unemployment.

Aside this,the massive production of goods and services will tend to reduce the unit cost and by extension the unit price of goods and services.this will also provide more home made raw materiald for the industries and the cycle goes on.The Bank on the other hand generate more profits from interest and commission charged and reffferals which lead to recruited staff of the fqctories doing personal business with the banks ,as the branches of the factories are sprouting ,more branchesof the banks will emerge providing more jobs and sustainability for the sector.

The government collect taxes and revenues from the citizen and industries leading to increase GDP, exports will increase and foreign exchange inflow will be positive.