Suppose the federal government wants to encourage businesses to increase investment spending. Which policy may be the most effective?
a. an increase in corporate income taxes
b. an increase in real interest rates
c. an increase in warnings of a coming recession
d. an increase in tax deductions for investment spending
d
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In the figure above, illustrates the effect of an increased rate of money supply growth at time period 0. From the figure, one can conclude that the
A) liquidity effect is smaller than the expected inflation effect and interest rates adjust quickly to changes in expected inflation. B) liquidity effect is larger than the expected inflation effect and interest rates adjust quickly to changes in expected inflation. C) liquidity effect is larger than the expected inflation effect and interest rates adjust slowly to changes in expected inflation. D) liquidity effect is smaller than the expected inflation effect and interest rates adjust slowly to changes in expected inflation.
Theater Upgrades BMC is considering upgrading the sound systems in their theaters so that they can patrons can get the full experience from surround sound movies. They discovered that upgrade costs at locations with 12 screens were $170,000 but were $110,000 at locations with six screens. What are the fixed costs of upgrading at a location?