Which of the following statements is TRUE?
A) There is a direct relationship between investment and the interest rate.
B) There is an inverse relationship between investment and the interest rate.
C) There is no relationship between investment and the interest rate.
D) Investment is always less than savings.
B
You might also like to view...
The reserve ratio is 10 percent and all loan proceeds are deposited in transactions accounts. A bond dealer has $100 million in deposits, $8 million in vault cash, and $7 million in deposits at the Fed
The Fed sells $1 million in securities to the bond dealer. As a result, of this transaction alone A) the money supply falls by $1 million and total reserves rise by $1 million. B) the money supply falls by $1 million and total reserves fall by $1 million. C) the money supply rises by $1 million, total reserves fall by $900,000. D) the money supply rises by $1 million, but reserves do not change.
With of the following is true with regard to leverage? a. The U.S.banking system uses very little leverage to ensure the safety of the banking system. b. Leverage in the banking system increases its potential for profits, but no losses
c. Losses borne by highly leveraged banks can have a ripple effect throughout the financial system. d. All of the above are true
Using a graph, explain why the law of supply holds for a competitive firm.
What will be an ideal response?
As exemptions are raised and allowable deductions are increased, there is
A. Greater horizontal equity. B. Greater vertical inequity. C. A smaller gap between effective and nominal tax rates. D. A smaller gap between gross income and taxable income.