If businesses forecast significant economic growth in the future, they may:
a. decrease their investment spending.
b. increase their investment spending
c. decrease their consumption spending.
d. increase their consumption spending.
b
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During an economic boom, output exceeds potential output
Indicate whether the statement is true or false
The sum of past federal budget deficits is the:
a. Congressional debt. b. GDP debt. c. national debt. d. trade debt plus GDP.
The risk structure of interest rates says:
A. the interest rates on a variety of bonds will move independently of each other. B. lower rated bonds will have higher yields. C. interest rates only compensate for risk during recessions. D. U.S. Treasury bond yields always change by more than other bonds.
What two factors affect the legal-institutional environment? Discuss the effect of changes in the legal-institutional environment on aggregate supply.
What will be an ideal response?