Since business firms will undertake a project whose rate of return exceeds the present level of interest rates, when interest rates
A) rise planned investment rises, ceteris paribus.
B) fall planned investment falls, ceteris paribus.
C) rise planned investment does not change.
D) rise planned investment falls, ceteris paribus.
D
You might also like to view...
In the United States, the Federal Reserve pursues an inflation targeting policy of keeping inflation below 2 percent
Indicate whether the statement is true or false
What reason do economists believe that megabanks are forming?
A) Megabanks enable economies of scale in information processing which allows them to better serve their customers. B) Megabanks create economies of scale which allow the banks to make riskier investment and increase profits. C) Megabanks can compensate for their economies of scale by diversifying into many countries. D) Megabanks allow investors more opportunities and have continued to grow by using their economies of scale to overwhelm their competition.
In an efficient market with rational expectations, the actual price of an asset
A) will equal its expected price. B) will often be below its expected price. C) will often be above its expected price. D) equals its expected price plus a random error term.
Social welfare functions require that a society has at least three people living in it.
A. True B. False C. Uncertain