Savings equals investment in an economy from "summary" of Principles of Macroeconomics by N. Gregory Mankiw
In an economy, savings and investment are two sides of the same coin. When individuals save a portion of their income, they are essentially providing funds that can be used for investment purposes. This is because savings represent money that is not being spent on consumption goods and services, but rather set aside for future use. On the other hand, investment refers to the purchase of goods that will be used to produce other goods and services in the future. This includes spending on capital goods such as machinery, buildings, and infrastructure. When individuals or businesses invest in these assets, they are essentially using the funds provided by savers to finan...
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