Abstention from consumption which enables capital to be produced is called

Assessment: WAEC SSCE - Economics - 2000 (Objective) Subject: Economics

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Abstention from consumption which enables capital to be produced is called
Answer Details
Abstention from consumption, which allows for capital to be generated, is called savings. When people or institutions save, they refrain from spending all of their income, leaving some for investment in productive activities such as the acquisition of tools, machines, buildings, and so on. This capital investment increases the economy's productive capacity and enables it to produce more goods and services in the future. Savings, therefore, are critical to the growth and development of an economy.
Read lesson note on The Theory Of Production (JAMB)
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