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 INVESTMENT IN REAL LIFE

Investment decisions revolve around how to properly allocate capital to maximize their value in everyday life. Investment is modeled as a function of interest rates given by I = I (r), with the interest rates negatively affecting investment because it is the cost of acquiring funds with which purchasing investment goods is possible and with income positively affecting investment because of higher income signals being greater. The interest rate and investment relationship refers to the relationship between the interest rate and the level of investment in economy. When interest rates are high, it becomes more expensive for businesses to borrow money in case of investment, which tends to reduce the spending in investment. The act of investing has the goal of generating income and increasing value over time. An investment can refer to any mechanism used for generating future economy. This includes the purchase of bonds or real estate property among other examples.

1) Grow your money on starting to invest, 2) Start investing to beat inflation, 3) Achieve financial goals and spend on those one choose, 4) Achieve financial independence after retirement.

The benefits of investment depend on potential for long-term returns, to outperform inflation, to provide a regular income, to tailor changing needs, and to invest fitting with financial circumstances. Being the purchase of capital or productive assets such as machinery and business premises, - the aim of such investments will be to enable the production of goods or services that will generate future cash flow and profits for future. The greater the risk that an investment may lose money, the greater will be its potential for providing a substantial return. By the same token, the smaller the risk an investment possess, the smaller the return of potential will be provided.