Spending by businesses on things such as machines and buildings which can be used to produce goods and services in the future is
A. savings.
B. consumption.
C. consumption goods.
D. investment.
Answer: D
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As world economies start to recover from the 2008 financial crisis and firms expect profits to increase
A) the price level in the U.S. will decrease as firms increase investment. B) the U.S. short-run aggregate supply curve immediately will shift rightward. C) investment will increase and there will be a movement up along the aggregate demand curve. D) both investment and aggregate demand will increase.
Suppose the economy is in a long-run equilibrium when a temporary, favorable aggregate supply shock occurs. On the graphs above, show what happens to bring the economy back to long-run equilibrium, assuming that there is no policy response
In words, explain why "no response" is the best policy.
The market demand curve for a monopolist is typically
a. unit price elastic. b. downward sloping. c. horizontal. d. vertical.
Using hindsight to judge whether buying insurance was a good idea or not:
A. is commonly used by people who wish to buy insurance in the future. B. is the only way to properly measure the true cost of the insurance and its benefit. C. can prove that a good decision at the time was really not worth it. D. is not a good idea; you have to measure the decision considering the information available at the time.