Contrast the shapes of the supply curves for financial capital and land
The usual supply curve for capital shows an upward slope with respect to interest rates. A higher interest rate increases the portion of income saved and available for capital spending. The supply is relatively inelastic with respect to interest rates, partly because some people will actually save less as i increases; such individuals will not need to save as much to meet a future sum when interest rates are high. The supply of land is approximately vertical, since in absolute terms there is a fixed amount of land.
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In the figure above, if point "a" represents the original equilibrium and point "b" the new equilibrium, then
A) there has been an increase in supply. B) there has been an increase in demand. C) there has been a change in the quantity supplied and no change in supply. D) Both answers B and C are correct. E) Both answers A and B are correct.
What are the macroeconomic implications from the recent increase in trend rate productivity?
Please provide the best answer for the statement.
The United States is considered by the Institute for Management Development to be the most competitive economy because
A) U.S. residents are willing to work harder than anyone else is. B) of widespread entrepreneurship. C) of a high saving rate. D) of selected restrictions on imports from Japan and Europe.
Open market operations are
A. the buying and selling of existing U.S. government securities in open private markets by the Fed in order to change the money supply. B. the selling of new government securities by banks in order to increase the money supply. C. the selling of new government securities in open private markets by banks in order to finance the deficit. D. the buying and selling of existing U.S. government securities in open private markets by citizens.