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If Firm-Level Asymmetric Information Becomes More Severe, Then

Question 45

Multiple Choice

If firm-level asymmetric information becomes more severe, then


A) investment demand decreases.
B) investment demand does not change.
C) investment demand increases.
D) there is an unambiguous effect on investment demand.
E) investment demand decreases if the substitution effect dominates, increases if the income effect dominates.

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