The Eye of Horus incense company has $10 million in cash which it has accumulated from retained earnings. It was planning to use the money to build a new factory. Recently, the rate of interest has increased. The increase in the rate of interest should
a. not influence the decision to build the factory because The Eye of Horus doesn't have to borrow any money.
b. not influence the decision to build the factory because its stockholders are expecting a new factory.
c. make it more likely that The Eye of Horus will build the factory because a higher interest rate will make the factory more valuable.
d. make it less likely that The Eye of Horus will build the factory because the opportunity cost of the $10 million is now higher.
d
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A. An expected increase in the future price of the product B. A decrease in the current price of a substitute product C. A decrease in the current price of a complementary product D. An increase in the current price of a substitute product
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A. 45-degree; consumption function B. 45 degree; expenditure C. consumption function; 45-degree D. expenditure; 45-degree