Answer the following questions true (T) or false (F)
1. An increase in the real interest rate will decrease consumption and investment.
2. Retained earnings are always sufficient to finance a firm's rapid expansion in a high-growth economy.
3. Financial markets and financial intermediaries comprise the financial system.
1. TRUE
2. FALSE
3. TRUE
You might also like to view...
Which one of the following is a key to economic development?
A) an educated population B) the removal of property rights C) the preservation of established means of production D) a high level of protection against imported products
GDP is defined as the market value of all ________ in a given time period
A) final goods produced in a country B) final goods and services produced by citizens of a particular country regardless of where in the world they are located C) final goods and services produced in a country by only the citizens of the country D) final goods and services produced in a country
Capital outflows occur if:
A) domestic interest rates are higher than foreign interest rates. B) domestic interest rates are lower than foreign interest rates. C) domestic and foreign interest rates are the same. D) none of the above.
When consumers would have been willing to pay higher prices at various quantities consumed than the market clearing price, the differences are called
A) consumer surplus. B) monopoly profits. C) opportunity cost. D) deadweight loss.