![]() Investment can be defined in a few ways. In medical terminology it refers to the envelope that literally in-vests or surrounds an organism. In accounting, financial or economic terminology, an investment refers to the outlay of capital for a profit. The money that is used to start or maintain a business is a capital investment. In classical economics, capital is one of three factors of production, capital, land, and labor. Products that are convenient, enjoyable, and desirable, may be something you want to invest in, that is purchase stock in the company that produces them, and in medical terminology, surround yourself in the benefits of the product. Often we hear salespeople say that the purchase of an item is an investment, this makes warning bells sound in my head, as they often misrepresent the financial aspect of the purchase. A product wrapped up in a high price may be enjoyable but with no financial gain. Beware of salespeople who use the term investment to allure you to a sense of well-being both in medical and financial terms. When they are quick to take your credit card or offer financing, it is likely that the transaction will be listed as a liability on your financial statement. Will the long term wrapper primarily in-vest you in debt? Before we make an investment in anything, we need to be clear on what it produces for us, will it produce more than it costs? Or is the purchase simply for pleasure? Pleasure can be good, but lets be clear, it is a pleasure purchase and not likely an investment.
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AuthorKevan Adams: Archives
January 2019
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