Multiple Choice
The cost of capital for investment, if the price of capital goods rises with the price of other goods and in the absence of taxes, may be summarized as the:
A) nominal interest rate plus the depreciation rate.
B) real interest rate plus the depreciation rate.
C) purchase price of a capital good multiplied by the sum of the nominal interest rate plus the depreciation rate.
D) purchase price of a capital good multiplied by the sum of the real interest rate plus the depreciation rate.
Correct Answer:
Verified
Correct Answer:
Verified
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