Who makes investment decisions in most modern industrial societies? Discuss the roles played by firms, households, and the capital market
What will be an ideal response?
In most modern societies, firms primarily make investment decisions. Households decide how much to save, and the level of saving limits the amount of investment which firms can undertake. The capital market directs household savings into profitable investment projects.
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Average real wages have not risen significantly since approximately 1973.
Answer the following statement true (T) or false (F)
The? self-interest theory of government explains why many states have limits on
A. taxes and government spending. B. the number of times politicians can be? re-elected. C. the number of people who can be? free-riders. D. all of the above
What is the most likely effect of the development of DVD players and Internet streaming on the movie theater industry?
A. Movie theater tickets become an inferior good B. Increased price elasticity of demand for movie theater tickets C. Decreased costs of producing movies D. Increased demand for movie theater tickets
Which one of the following statements is TRUE?
A. The Keynesian model cannot explain periods of prolonged unemployment. B. The classical model cannot explain periods of prolonged unemployment. C. The Keynesian model assumes complete flexibility of wages and prices. D. The Keynesian model shows that the level of real GDP is supply-determined.