Where does the interest rate fit into the accelerator hypothesis of investment?
A) It helps determine the error-learning parameter, j.
B) It helps determine the ratio of desired capital to expected sales, v*.
C) It helps determine the depreciation ratio of capital stock to replacement investment.
D) Nowhere: the hypothesis says that investment is independent of the interest rate.
B
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Which of the following statements is true?
A. Passively managed funds do not pay dividends B. Passively managed funds have only one asset in their portfolio C. Actively managed funds constantly buy or sell assets to generate better returns D. Actively managed funds adjust assets to match the performance of a particular index
When a positive externality exists in a market, total surplus:
A. is the same as a market without a negative externality. B. is decreased by deadweight loss compared to that same market without a negative externality. C. is the same but re-distributed differently than if that same market did not have a negative externality. D. is increased by deadweight gain compared to that same market without a negative externality.