Why are savings important to an economy Can an economy survi

Why are savings important to an economy? Can an economy survive without household savings?

Solution

Answer - Saving money is important to country economy. It provides long term economic stability.

Most of the time people save money by keeping money in banks. Now banks can take this money and lend to businesses. And thus it allows businesses to make capital expansion. It will also generate employment. If we save money we give banks opportunity to lend more and more money. And thus economy can improve. A saving usually helps country high potential to invest in capital.

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