What is capital income?
What will be an ideal response?
Capital income is income earned on savings that have been put to use through financial capital markets. Interest is the most common form of capital income.
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The market demand curve for a particular good
a. will shift to the right if more consumers enter the market b. could shift to the left if more consumers enter the market c. will be upward sloping if the good is an inferior good d. will always shift to the right if consumers' incomes increase e. could shift downward if more consumers enter the market
Contractionary monetary policy tends to:
A. reduce the interest rate, increase capital inflows, and lower the value of the dollar. B. raise the interest rate, reduce capital inflows, and raise the value of the dollar. C. reduce the interest rate, reduce capital inflows, and lower the value of the dollar. D. raise the interest rate, raise capital inflows, and raise the value of the dollar.
Which of the following is not a reason why specialization and trade are beneficial to society?
A. The total output of economic goods may be increased even without any increase in resources B. Scarce resources are utilized more efficiently by exploiting differences among them C. Specialization fosters learning by doing, thus lowering the unit-costs of products D. Firms and workers become less dependent on others for producing goods and services
If the opportunity cost of producing more of one good remains the same as more of that good is produced, then the production method is inefficient
Indicate whether the statement is true or false