Investment spending is inversely related to the interest rate
a. True
b. False
A
Economics
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Which of the following is an example of a cash outflow from a financing activity?
A. Sale of an intangible asset B. Purchase of treasury shares C. Issuance of bonds D. Distribution of stock dividends
Economics
In the money market, if the interest rate exceeds the equilibrium interest, there is a surplus of money. How is the surplus eliminated?
A) People buy bonds to rid themselves of the surplus money, bidding up their price and pushing interest rates down. B) Banks will lend out the surplus, lowering interest rates. C) The Federal Reserve will destroy currency, reducing the quantity of money. D) The high interest rate increases the demand for money, eliminating the surplus.
Economics