Investment spending is a stock variable
a. True
b. False
B
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Foreign direct investment declined worldwide during the recession of 2007-2009
The decline in foreign direct investment in developing countries can make it more difficult for these countries to break out of the vicious cycle of low economic growth and A) overpopulation. B) low saving and investment. C) low government spending. D) a low import/export ratio.
An income effect
A. is measured as the change in prices over time. B. is not possible when people are unemployed. C. requires interest rates to remain constant. D. is the change in the quantity demand, due to the fact that real income changes when prices change.
Suppose that a steel factory emits a certain amount of air pollution, which constitutes a negative externality. If the market does not internalize the externality,
a. the supply curve would adequately reflect the marginal social cost of production. b. consumers will be required to pay a higher price for steel than they would have if the externality were internalized. c. the market equilibrium quantity will not be the socially optimal quantity. d. producers will produce less steel than they otherwise would if the externality were internalized.
The saving schedule shows the relationship of saving of households to the level of:
A. Consumption B. Investment C. Disposable income D. The average propensity to save