A firm will invest in a project if
A. the firm's level of capital is higher than the desired level.
B. the rate of return of the project is greater than the opportunity cost of the investment.
C. the interest rate exceeds the opportunity cost of the project.
D. the firm's level of capital is at the desired level.
Answer: B
You might also like to view...
Which of the following contributes to economic growth?
A) increase in environmental protection policies B) increase in labor regulations restricting the hours of overtime allowed C) increase in labor productivity D) increase in consumer spending
Determinants of income differences include all of the following EXCEPT
A) age. B) marginal productivity. C) moral hazard. D) discrimination.
The Treasury usually requires most businesses to regularly deposit taxes withheld from employees into accounts at designated commercial banks. On a regular basis, the funds in these accounts are transferred to the Treasury's account at the Fed. Discuss what is happening to the balance sheet of the banking system as the businesses are making deposits and these tax accounts are increasing. What happens to the banking system's balance sheet when the funds are transferred to the Fed?
What will be an ideal response?
If tolls on a toll road can be raised significantly before commuters will consider using a free alternative, demand for using the toll road must be
A) inelastic. B) elastic. C) unit elastic. D) perfectly elastic.