The investment function implies that current output does not influence investment. Does that make sense?
What will be an ideal response?
Yes. Planned investment relies mostly on business expectations of future economic activity. Fluctuations in current activity affect investment as unplanned inventory changes and, perhaps, as an updating of expectations, causing a change in autonomous investment.
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When you toss your spare quarters into a jar so you can use them later at the laundromat, you are using money in its function as a
A) medium of exchange. B) unit of account. C) store of value. D) record keeping device.
Which of the following is a method used by unions to increase the demand for their members' labor?
A) Support import restrictions. B) Decrease the marginal product of union members. C) Oppose immigration restrictions. D) Oppose minimum wage laws.
Which of the following correctly comments on the following statement? "The only way to increase the revenue from selling a product is to increase the product's price."
A) This statement is not true. Revenue will increase as the price of the product increases only if demand is inelastic. B) It is not true. Revenue will increase as the price of the product increases only if demand is elastic. C) This statement is not true. Revenue will decrease as the price of the product increases because quantity demanded will fall. D) The statement is true.
When a supply curve is relatively flat, the
a. sellers are not at all responsive to a change in price. b. equilibrium price changes substantially when the demand for the good changes. c. supply is relatively elastic. d. supply is relatively inelastic.