Which of the following items is (are) not considered as part of the net investment calculation?
a. installation and shipping charges
b. acquisition cost of new asset
c. salvage value of old equipment that is being replaced
d. first year's net cash flow
e. c and d
d
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Suppose that the equilibrium price of apples decreases and the equilibrium quantity of apples increases. This is best explained by a(n):
A. decrease in the demand for apples. B. increase in the demand for apples. C. decrease in the supply of apples. D. increase in the supply of apples.
Developing new products and services as well as introducing new production methods are among the ways that ________ increases average labor productivity.
A. an entrepreneur B. physical capital C. a manager D. human capital
Transfer payments are excluded from government purchases in GDP accounting because:
A. they are difficult to measure. B. they are a reward to individuals who have been productive their entire lives. C. they are already included as part of investment. D. nothing is being produced in return for the payment.
Suppose the market for loanable funds is in equilibrium. What would happen in the market for loanable funds, other things the same, if the Congress and President increased the maximum contribution limits to 401(k) and 403(b) tax-deferred retirement accounts?
a. the interest rate and quantity of loanable funds would increase b. the interest rate and quantity of loanable funds would decrease. c. the interest rate would increase and the quantity of loanable funds would decrease. d. the interest rate would decrease and the quantity of loanable funds would increase.