Which of the following is least likely to contribute to the volatility of investment spending?
a. Expectations about business conditions
b. Changes in government spending
c. Changes in tax laws
d. Changes in capacity utilization
e. Interest rate fluctuations
b
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Which of the following schools of thought believes that the major source of the macroeconomic problems are the disequilibria in the private labor and goods market?
a. Keynesians and new Keynesians b. Only monetarists c. Only new classical economists d. Monetarists and new classical economists e. Monetarists and Keynesians
A corporation has been steadily losing money on one of its product lines. The factory used to produce that brand cost $20 million to build. The firm now is considering an offer to buy that factory for $15 million. Which of the following statements about the decision to sell or not is correct?
a. The firm should turn down the purchase offer because the factory cost more than $15 million to build. b. The $20 million spent on the factory is a sunk cost that should not affect the decision. c. The $20 million spent on the factory is an implicit cost that should be included in the decision. d. The firm should sell the factory only if it can reduce its costs elsewhere by $5 million. e. The firm's opportunity cost would be $35 million if it decides to sell the factory.
In the balance of payments, financial transactions include all
a. transactions in which money changes hands. b. flows of financial investments between nations. c. net deficit items. d. net surplus items.
Which of the following groups have no promise of any payment from the corporate firm?
a. the banks who have loaned the company money b. the common stockholders c. the preferred stockholders d. the managers e. the bondholders