The law of supply can be stated as all else equal:
A. quantity supplied rises as income falls.
B. quantity supplied rises as income rises.
C. quantity supplied rises as price rises.
D. quantity supplied rises as price falls.
Answer: C
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Tobin's q is
A) the ratio of a firm's market value on the stock and bond markets to the replacement cost of its capital stock. B) the ratio of a firm's gross investment to its capital stock less its replacement cost of capital. C) a firm's replacement cost of capital less its value on the stock and bond markets. D) the ratio of a firm's replacement cost of capital to its gross investment.
Consider an open economy that is a net borrower (like the United States). What would be the impact of a shift to a closed economy?
A) domestic interest rates would decline B) domestic savings would decline C) domestic investment would decline D) net borrowing would increase
What are the factors that can shift the supply of financial capital to a certain investment?
a. if people do not want to alter their existing levels of risk b. if the riskiness or return on one investment is the same as other investments c. if the riskiness or return on one investment changes relative to other investments d. if people do not want to alter their existing levels of consumption
Why is it more expensive to acquire a new house in an urban area than in a rural area if the costs of labor and building materials are the same?