Which of the following is not considered investment?

A. the construction of a new factory
B. the purchase of government bonds
C. the acquisition of capital goods
D. the increase in planned inventories


Answer: B

Economics

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Suppose the market supply curve is p = 5Q. At a price of 10, producer surplus equals

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A firm purchases a factor of production in a competitive market. At the current purchase rate the MRP of the factor is greater than the marginal expenditure for the factor. Thus, the firm

A) can increase profit by reducing the employment of the factor of production. B) is now maximizing profit. C) should not use this factor of production because it has no potential in generating a profit. D) can increase profit by expanding the employment of the factor of production.

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National Income (NI) is calculated by adjusting GDP for

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A profit-maximizing firm employs resources to the point where

A. MRP = MRC. B. MP = product price. C. MRC = MP. D. resource price equals product price.

Economics