As the economy expands, it requires les and less investment.

What is your question?

T/F???

The statement you mentioned, which suggests that as the economy expands, it requires less and less investment, seems counterintuitive. Normally, as an economy grows, it typically requires more investment to support that growth. However, I can provide an explanation for this claim based on possible interpretations:

1. Interpretation with diminishing marginal returns: One possible explanation is based on the concept of diminishing marginal returns. According to this idea, as an economy expands, the returns on each additional unit of investment decrease over time. In other words, the initial investments may result in high returns, but as the economy grows, it becomes more challenging to find productive investment opportunities that generate the same level of returns. Therefore, it might appear that it requires less investment to sustain or achieve further growth.

2. Interpretation with increasing efficiencies: Another possible understanding is that as an economy expands, it becomes more efficient, leading to increased productivity and output. With improved technology, better infrastructure, and increased knowledge, certain industries become more efficient over time. Therefore, the same level of investment might generate higher growth rates than before, resulting in the perception that less investment is required for further expansion.

However, it is important to note that these interpretations do not represent general economic principles, and it is uncommon for an economy to require less investment as it expands in practice.