Which of the Following Is True Regarding Investment

question 65

Multiple Choice

Which of the following is true regarding investment?

• A) In the short run it increases aggregate supply but in the long run it increases aggregate demand.
• B) In the short run it influences aggregate demand and in the long run it influences the rate at which the economy grows.
• C) In the short run it influences aggregate demand but in the long run it retards economic growth since it requires saving.
• D) In the short run it reduces aggregate demand because it requires savings but in the long it promotes economic growth.

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Definitions:

Counting Rule

A mathematical rule to determine the number of possible outcomes in a situation without having to list them all explicitly.

Combinations

Refers to the selection of items from a larger set where the order of selection does not matter.

Binomial Experiment

An experiment or trial that can be reduced to two outcomes, success or failure, and is repeated a fixed number of times.

Continuous Random Variables

Variables capable of assuming any value within a specified range, with the potential for infinite variations.