Question

explain why economic investment in capital represents a trade-off between present and future consumption in detail?

Answer 1

The economic investment in capital represents our trade-off between present and future consumption in such a manner.
A trade-off is basically a situation where all decision that finally involves a diminishing or a sacrificing of one quality or quantity of a particular thing in return for the gain of other things in some aspects,
In other words, A tradeoff is a term where the gain of one thing is on the cost of the Sacrifice of another thing.
So in this case, the present economic investment is very important for the future Plan of the consumption it is all about the sustainability of the resources.
If your investment in the present scenario is systematic then only you can expect a proper investment and return from the future.
For example, if there is no alternative available for fuel then by the cost of using the present source of fuel, the future generation is not able to manage the fuel for their uses.
If the present industrial base is not strong and not up to the mark to fulfil the future requirements then it is very difficult for the future investors to retain all such things on the basis of the present investment and the requirement of the future.
The trade-off condition is very essential from the present point of view if the systematic arrangement is not managed properly then it is very difficult for the future consumptions.
Future consumption is totally based on forecasting and the planning of forecasting is based on the present policies. If the present policies are strong then definitely the future consumption pattern is also very systematic and manageable in all economic principles.