The more sensitive planned investment is to the interest rate, the less the effectiveness of monetary policy.
a. true
b. false
Answer: b. false
You might also like to view...
Suppose a person calculates his permanent income by adaptive expectations. Last year's permanent income was 54,000, this year's actual income is 44,000, j = 0.20, and k = 0.82. What is his consumption expenditure this year?
A) 34,840 B) 43,472 C) 36,784 D) 42,640 E) 37,720
If a country has a trade surplus then
a. S > I and Y > C + I + G. b. S > I and Y < C + I + G. c. S < I and Y > C + I + G. d. S < I and Y < C + I + G.
A car leasing company that expands its size by buying its competitors may run the risk of increasing production cost per unit due to:
A. diseconomies of scale. B. economies of scale. C. diminishing returns. D. greater use of large-volume purchases.
Refer to the above figure. The equilibrium level of real Gross Domestic Product (GDP) is
A. $7 trillion. B. $12 trillion. C. $6 trillion. D. $20 trillion.