By the accelerator hypothesis, if a firm's actual sales jump in one period to a higher maintained level, that firm's gross investment

A) also jumps in one period to a higher maintained level.
B) gradually drifts upward to a higher maintained level.
C) jumps upward and then falls back to zero.
D) jumps upward and then falls back part of the way.


D

Economics

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Overproduction results in

A) external costs. B) external benefits. C) deadweight loss. D) super-efficiency. E) the marginal benefit of the last unit produced being larger than the marginal cost.

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If a voluntary trade takes place,

a. both parties will benefit from the transaction. b. only one party will benefit from the transaction. c. neither party will benefit from the transaction. d. both parties will benefit only if the government regulates the transaction.

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If the price of walnuts rises, many people would switch from consuming walnuts to consuming pecans. But if the price of salt rises, people would have difficulty purchasing something to use in its place. These examples illustrate the importance of

a. the availability of close substitutes in determining the price elasticity of demand. b. a necessity versus a luxury in determining the price elasticity of demand. c. the definition of a market in determining the price elasticity of demand. d. the time horizon in determining the price elasticity of demand.

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Federal Reserve governors are given long terms to insulate them from politics

a. True b. False Indicate whether the statement is true or false

Economics