When the interest rate in the market increases to 8 from 4 the planned investment drops by 150 billion, the answer is "B". as at a higher interest rate the investment in the market will be low.
refer to figure 23.8. the amount of planned investment _____ if the interest rate rises from...
1) If Inventory investment is higher than firms planned, a) actual investment is greater than planned investment. b) actual investment is less than planned investment. c) actual investment must be negative. d) actual and planned investment are equal. Refer to the information provided in Figure 8.8 below to answer the questions that follow. Figure 8.8 2) Refer to Figure 8.8. The amount of planned investment decreases if the interest rate a) rises from 4% to 8%. b) remains at 8%....
7) Given the relationship between interest rates and planned investment planned investment A) increases if the interest rate drops from 6% to 4%. B) increases if the interest rate rises from 6% to 8%. C) is unaffected by any changes in interest rates. D) both A) and B) are correct. 8) To combat a recession with fiscal policy, the government should A) reduce government spending. B) reduce taxes on consumers to increase consumer disposable income. C) lower interest rates and...
If the real interest rate is currently 12 percent and real GDP is $130 billion, what will be the level of planned investment for this country?
emergency plz thanks 12. For the following questions refer to Figure 2. Spending C + Planned 1000 500 150 75 150 1000 Income Figure 2: Aggregate Demand and Supply (a) In this economy, what is the quantity of planned investment? 5 points. (b) What is the value of the multiplier in this economy? 5 points. (c) Calculate the quantity of unplanned inventories at Y=750.5 points.
MS Interest rate, r 1,000 500 800 Money, M Figure 16.3 Refer to Figure 16.3. The money market will be in equilibrium at an interest rate of: O 0%. 0 0 0 QUESTION 16 Interest rate (%) BM mo Money Fig 16.1 Refer to Figure 16.1. Which demand for money decreases when income decreases and causes a movement from Point A to Point E? O transactions demand for money O speculative demand for money O liquidity demand for money O...
QUESTION 7 Refer to the information provided in Table &.4 below to answer the questions that fallow. Table 84 All Figures in Billions of Dollars Aggregate Output Aggregate Consumption Planned Investment 100 160 20 200 240 20 20 300 320 400 400 20 500 480 20 Refer to Table 8.4. At an aggregate output level of $200 billian, planned expenditure equals O $160 billion. O $220 billion. O $260 billion. O $410 billion. QUESTION & AE Refer to the informotion...
TALS. LOJ INTEREST RATE 4. Illustrate the effects on investment of LO15-2 (a) An interest rate cut (point A). (b) An interest rate cut accompanied by decreased sales expectations (point B). 5. How much would the Fed have had to INVESTMENT reduce long-term interest rates to get the same stimulus as President Trump's planned $300 billion fiscal stimulus? LO15-2 e
question 15 QUESTION 15 Interest MS Rate MS, Interest Rate Iz Planned Investment Quantity of Money Price Level LRAS SRAS, SRAS AD AD Real GDP in Trillions per Year In the above figure, suppose the economy is at a short-run equilibrium at point and the interest rate is r 2. Which of the following policy options for the Fed will help solve the short-run situation? open market sale of government securities lowering the differential between the discount rate and the...
Question text If the interest rate rises to 25% would the investment still take place?
Assume there are no investment projects that will produce an expected rate of return of 8 percent or more. There are, however, $2 billion worth of investment projects with an expected rate of return at 7 percent, an additional $2 billion for every drop of the interest rate by 1 percent. If the real interest rate is 3 percent in this economy, the cumulative amount of investment at the 3 percent or higher rate of return is: A. $10 billion...