Which of the following is true of investment spending?
a. It depends on perceptions about future economic conditions
b. It increases as the current level of real gross domestic product increases.
c. As the expected rate of return on investment spending decreases, the investment spending function shifts upward.
d. As the real interest rate decreases, the investment spending function shifts downward.
a
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When Acme Inc produces a certain amount of output by using the least amount of inputs, Acme Inc definitely
A) maximizes profits. B) minimizes labor costs. C) achieves technological efficiency. D) achieves economic efficiency.
The president of XYZ, Incorporated is considering the purchase of new equipment. The equipment is expected to increase profits by $25,000 per year for four years. After that, the equipment will have no value
If the machine costs $80,000 and the market rate of interest is 6 percent, should your firm purchase the machine? Explain.
Explain the impact that growth rates have on countries, both rich and poor, over time. Select three countries from Exhibit 3 and calculate to a tenth of a year how many years it will take their economies to double, assuming their growth rates remain constant.
What will be an ideal response?
According to the quantity theory of money, which one of the following economic variables would change in response to an increase in the money supply?
A. prices B. real income C. velocity D. employment