The neoclassical theory of investment
A) links investment spending to stock prices.
B) emphasizes that current investment spending depends positively on the expected future growth of GDP.
C) emphasizes the role of real interest rates and taxes as determinants of investment.
D) suggests that a downturn in real GDP will lead to a sharp fall in investment, which leads to further reductions in GDP through the multiplier.
C
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The aggregate savings in an economy is $1,750 and the GDP of the economy is $55,000. The savings rate in the economy is:
A) 1.8%. B) 3.15%. C) 10%. D) 8.96%.
Refer to the above figure. The profit-maximizing price and output for this monopolist are
A) a price of P1 and output of Q1. B) a price of P4 and output of Q1. C) a price of P2 and output of Q2. D) a price of P3 and output of Q3.
_____________ advantage can be the result of a country’s natural endowment.
a. Absolute b. Real c. Focused d. Micro
Charles wants to buy a pound of salted tuna. He is willing to pay up to $3 per pound for his favorite brand. The local store sells this brand of tuna for $2 . If Charles purchases a pound of tuna, then his consumer surplus is _____
a. $1 b. $1.50 c. $0.50 d. $2