The higher the opportunity cost of borrowing, the higher the amount of investment, other things constant.
a. true
b. false
b. false
You might also like to view...
Assuming that the average duration of its assets is five years, while the average duration of its liabilities is three years, then a 5 percentage point increase in interest rates will cause the net worth of First National to decline by ________ of
the total original asset value. A) 5 percent B) 10 percent C) 15 percent D) 25 percent
The role of the Commodity Futures Trading Commission is to
A) set the prices of futures contracts. B) operate the Chicago Mercantile Exchange. C) operate the Chicago Board of Trade. D) monitor potential price manipulation in futures trading.
Which of the following is a property of an S-shaped curve that corresponds to the prospect theory value function?
A) The curve passes through the reference point at the origin. B) Both sections of the curve are convex to the horizontal, outcome axis. C) The curve is symmetric with respect to gains and losses. D) None of the above.
The supply-side effects of a reduction in taxes are the result of
a. increases in the disposable income of households accompanying reductions in tax rates. b. the stimulus effects of increases in government expenditures. c. increased attractiveness of productive activity relative to leisure and tax avoidance. d. reductions in interest rates that generally accompany expansionary fiscal policy.