Which of the following could be a direct cause of investment spending increasing?
A. The wealth of consumers increasing causing them to radically increase their purchases.
B. Interest rates increase.
C. A firms costs unexpectedly drop making their profit margin higher.
D. Expected future income decreases.
C. A firms costs unexpectedly drop making their profit margin higher.
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In the circular flow diagram, aggregate expenditure includes the sum of
A) saving and investment. B) consumption and investment. C) consumption, investment, and saving. D) income and saving.
An increase in price causes:
A. a decrease in total revenue due to the price effect. B. an increase in total revenue due to the price effect. C. an increase in total revenue due to the quantity effect. D. an increase in quantity demanded.
"Never put all your eggs in one basket." This saying refers to the concept of
a. averaging. b. market timing. c. diversification. d. leveraging.
An increase in the real exchange rate indicates that
A) domestic goods are now relatively cheaper. B) domestic goods are now relatively more expensive. C) foreign goods are now relatively cheaper. D) both B and C