In the loanable funds model, an increase in an investment tax credit would create a
a. shortage at the former equilibrium interest rate. This shortage would lead to a rise in the interest rate.
b. shortage at the former equilibrium interest rate. This shortage would lead to a fall in the interest rate.
c. surplus at the former equilibrium interest rate. This surplus would lead to a rise in the interest rate.
d. surplus at the former equilibrium interest rate. This surplus would lead to a fall in the interest rate.
a
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Why is money you receive at some future date worth less to you than money you receive today?
What will be an ideal response?
The rate-of-return regulated public utility has strong incentive to control cost
Indicate whether the statement is true or false
Along the elastic range of a demand curve, a decrease in price causes:
a. no change in total revenue. b. a decrease in total revenue. c. an increase in total revenue. d. an unpredictable change in total revenue.
Sizeable budget deficits can be expected in the years ahead because
a. the retirement of the baby boom generation will soon begin to push expenditures on both Social Security and Medicare upward. b. the political incentive structure encourages politicians to spend more revenue than they are willing to tax. c. both a and b are true. d. both a and b are false. Budget surpluses can be expected in the years ahead.