Which of the following would an economist consider to be investment?
A. Boeing building a new factory.
B. Oprah buying a $10 million home from a fellow celebrity.
C. A stockbroker buying 10,000 shares of Starbucks stock.
D. All of these.
Answer: A
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A decrease in the riskiness of corporate bonds will ________ the price of corporate bonds and ________ the price of Treasury bonds, everything else held constant
A) increase; increase B) reduce; reduce C) reduce; increase D) increase; reduce
A piece of land is divided between John and Mary. However, only John gets the title to his share of land. Which of the following is true?
a. Both Mary and John will not take care of their lands. b. Mary will have a higher per capita output from her piece of land. c. John will not be able to rent out a portion of his land. d. Mary will have a greater incentive than John to invest in her piece of land. e. John will be able to use his land as collateral for a loan from a bank.