Changes in real planned investment spending have
A. a direct relationship to changes in the level of household savings.
B. an inverse relationship to changes in the interest rate.
C. no identifiable relationship to changes in the interest rate.
D. a direct relationship to changes in interest rates.
Answer: B
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What would happen to the availability of credit if banks chose to either increase or decrease the percentage of deposits they hold as reserves?
What will be an ideal response?
If the interest rate is 10%, then $1 today is worth how much one year from now?
A) $1.10 B) $1.00 C) $0.91 D) $0.90
According to Keynes, investment demand depends less on interest rates than on the
a. availability of savings b. flexibility of wages and prices c. level of disposable income d. competitiveness of labor markets e. expectations of a continuing robust economy
The information on a demand curve is also on a(n)
A. budget constraint. B. indifference curve. C. income-consumption curve. D. price-consumption curve.