Refer to the diagram. Which of the following would shift the investment demand curve from ID 1 to ID 3 ?
A. A lower interest rate.
B. Lower expected rates of return on investment.
C. A higher interest rate.
D. Higher expected rates of return on investment.
B. Lower expected rates of return on investment.
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If firms make agreements that reduce the amount of competition in a market,
a. the market price usually falls b. they would face penalties under antitrust legislation c. mergers will result d. there must be diseconomies of scale in the industry e. they would face penalties under contract law
Private investment expenditure, which is a flow, affects the stock of capital
a. True b. False
Suppose that the Home country in the twosector (manufacturing and agriculture) specificfactors model has a comparative advantage in agricultural output. Will workers be better or worse off following the opening of trade with other countries?
a. Workers will be better off because the nominal wage increases. b. Workers will be worse off because the nominal wage decreases. c. Workers may be better off or worse off because the real wage in terms of the agricultural good rises and the real wage in terms of the manufactured good falls. d. Workers may be better off or worse off because the real wage in terms of the agricultural good falls and the real wage in terms of the manufactured good rises.
Using the formula for an infinite sum, if "r" designates the reserve ratio, the 1 / reserve ratio would equal:
A. (1 - r). B. 1 / (1 - r). C. 1 / [1 - (1 - r)]. D. r / (1 - r).