In the capital market, the rental price is what a:
A. consumer pays to gain permanent ownership of a factor of production.
B. producer pays to use a factor of production for a certain period or task.
C. consumer pays to use labor or land services for a certain period or task.
D. producer pays to gain permanent ownership of a factor of production.
Answer: B
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If disposable income decreased, which of the following changes in the consumption-function line would occur?
a. A rightward movement along the line b. A leftward movement along the line c. The entire line would shift upward d. The entire line would shift downward e. The entire line would shift downward and there would be a rightward movement along the new line
High interest rates
A. increase the profitability of capital investments. B. decrease the opportunity costs of capital investments. C. increase the opportunity costs of capital investments. D. decrease the profitability of current sales.