The effect of a higher discount rate could best be represented by, ceteris paribus,
A. A downward shift of the investment demand curve.
B. A movement up the investment demand curve.
C. An upward shift of the investment demand curve.
D. A movement down the investment curve.
Answer: B
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Answer the following statement(s) true (T) or false (F)
1. The substitution and income effects are in opposition when the price of an inferior good changes. 2. The income and substitution effect always go in opposite directions. 3. An inferior good is one that is of lower quality than a substitute. 4. When the price of a good rises, the income effect always reduces the quantity demanded of the good. 5. If the price of a non-Giffen good falls, then the income effect causes a rise in the quantity demanded.
In a perfectly competitive market, because an individual seller tends to sell only a fraction of the total amount of the good produced:
A) he can independently determine the market price. B) he can charge prices above the equilibrium price. C) his individual choices do not affect market outcomes. D) he always earns positive profit.
The free-rider problem is
A) the use of private goods in one state by residents of another state. B) the incentive that people have to avoid paying for a public good. C) the incentive that people have once they are receiving welfare to keep getting welfare. D) that people cannot be forced to accept public goods.
The president of the United States can obtain a court injunction that will stop a strike for an 80-day "cooling-off"period if the strike is expected to imperil national safety or health. This power is granted in the
A) Wagner Act. B) Landrum-Griffin Act. C) National Industrial Recovery Act. D) Taft-Hartley Act.