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capital formation

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The creation of capital. For example, capital is created when banks lend the money they hold in savings accounts to firms that use the money to purchase machinery.

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The New Dictionary of Cultural Literacy, Third Edition Copyright © 2005 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

How to use capital formation in a sentence

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