Multiple Choice
During recessions, investment spending usually decreases because:
A) the real interest rate falls.
B) lower profits mean more firms face financing constraints.
C) the purchase price of capital decreases.
D) corporate tax rates usually decrease.
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q39: The profit rate of a firm that
Q40: The construction of a new apartment building
Q41: For a firm facing financing constraints on
Q42: The neoclassical model of investment says investment
Q43: Holding other factors constant, an increase in
Q45: Tobin's q equals the:<br>A) cost of buying
Q46: Use the neoclassical model of business fixed
Q47: Holding other factors constant, the decline in
Q48: If real interest rates increase, what will
Q49: Assume that the following model of the