A firm’s net investment will be negative if
a) the actual capital stock is less than the optimal capital stock
b) the rate of return on capital exceeds the market interest rate
c) the depreciation rate is less than the gross investment rate
d) gross investment is zero
e) its workforce is growing faster than its capital stock
d) gross investment is zero
You might also like to view...
If all income is consumed in a year, then
A) income next year will increase. B) investment spending will be zero. C) any investment spending will be done by the government. D) investment spending will increase.
The tables above show the labor market and the production function schedule for the country of Pickett. An increase in population changes the labor supply by 20 billion hours at each real wage rate. Potential GDP ________
A) does not change B) decreases to $3 trillion C) increases to $50 trillion D) increases to $18 trillion