An increase in real interest rate ………………cost of investment # randomize
A. Decreases
B. Increases
C. Does not affect
D. Diminishes
Answer: B. Increases
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Which of the following is false?
A. The completion of the national railroad network by 1890 led to the development of a national American market rather than just a series of smaller regional markets. B. Northern manufacturers benefited from high protective tariffs, which kept out cheaper British goods. C. The U.S. was the first mass-consumption society. D. Aside from slavery, southern and northern agriculture were very similar.
If the price level is 90, then the price level will ________ because ________
A) either fall or rise; markets are unstable and macroeconomic equilibrium is difficult to predict B) fall; the aggregate quantity demanded is less than the aggregate quantity supplied C) rise; the aggregate quantity demanded is less than the aggregate quantity supplied D) rise; the aggregate quantity demanded is greater than the aggregate quantity supplied E) fall; the aggregate quantity demanded is greater than the aggregate quantity supplied
If over a short time a large number of teenagers become old enough to find employment and a much smaller number of people retire, then productivity
a. and real GDP per person rise. b. rises but real GDP per person falls. c. falls but real GDP per person rises. d. and real GDP per person fall.