Which of the Following Was True for the Recession of 1981/82

question 31

Multiple Choice

Which of the following was true for the recession of 1981/82?

• A)nominal interest rates declined from 14.0% in 1981 to 10.7% in 1982, while real interest rates increased from 4.0% to 4.5%
• B)the unemployment rate went above 11%, a higher level than in the Great Depression
• C)the T-bill rate was lower than it ever was in the 1970s
• D)real interest rates decreased steadily after 1981
• E)all of the above

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Definitions:

NPV

Net Present Value represents a technique for assessing the profitability of a project or investment, utilized in the process of capital budgeting.

Cash Flow

The total amount of money being transferred into and out of a business, capturing the company's operational, investing, and financing activities.

Cost Of Capital

The minimum return rate a company needs to achieve on its investments to preserve its market valuation and draw in financing.

Cash Flow

The total sum of cash and cash-like assets moving in and out of a company.