If Private Sector Investment Does Not Respond Much to Interest

question 155

Multiple Choice

If private sector investment does not respond much to interest rate changes, then

• A) there will be more crowding out when expansionary policies are undertaken.
• B) there will be less crowding out when expansionary policies are undertaken.
• C) fiscal policy will be less effective than monetary policy.
• D) monetary policy will be more effective than fiscal policy.

Understand the different audiences for written communication in a professional setting.

Recognize the importance of clear and error-free communication in professional settings.

Understand the importance of appropriate documentation in business communication.

Recognize the impact of communication technology in business and the evolving role of electronic communications.

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Definitions:

Owners' Equity

The residual interest in the assets of a company after deducting liabilities, representing the value that belongs to the company's owners.

Convertible Bonds

Bonds issued by a corporation that can be converted into a predetermined number of the company's stock shares at the bondholder's option.

GAAP

The standard framework of guidelines for financial accounting that is widely recognized and used in a specific jurisdiction, especially within the United States, known as Generally Accepted Accounting Principles.

IFRS

International Financial Reporting Standards, which are international accounting standards for preparing and presenting financial statements.