Which of the Following Is a Reason Why a Greater

question 87

Multiple Choice

Which of the following is a reason why a greater capital stock can reduce investment?

• A) A greater capital stock is likely to lead to less investment because further increases in the demand for investment tend to raise the cost of capital.
• B) Since businesses undertake investment to adjust their stock of capital to its desired level, the amount of investment needed to reach the desired level will be lower when the current capital stock is higher.
• C) A greater capital stock is likely to lead to less investment since there will be less old capital to replace.
• D) The rate of new technological innovations tends to deter investment in new capital because capital becomes obsolete at a faster rate.

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Definitions:

CBT

Cognitive Behavioral Therapy, a type of psychotherapeutic treatment that helps patients understand the thoughts and feelings that influence behaviors.

Mindfulness

A mental state achieved by focusing one’s awareness on the present moment, while calmly acknowledging and accepting one's feelings, thoughts, and bodily sensations.

Present Moment

Focuses on the current point in time, emphasizing awareness and mindfulness of one's thoughts, feelings, and surroundings without distraction from past or future concerns.

Cognitive Theorists

Psychologists who study how our thought processes influence behavior and emotions, focusing on learning, memory, perception, and decision-making.