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Assume That If the Interest Rate That Businesses Must Pay

question 55

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Assume that if the interest rate that businesses must pay to borrow funds were 20 percent, it would be unprofitable for businesses to invest in new machinery and equipment so that investment would be zero.But if the interest rate were 16 percent, businesses would find it profitable to invest $10 billion.If the interest rate were 12 percent, $20 billion would be invested.Assume that total investment continues to increase by $10 billion for each successive 4 percentage point decline in the interest rate.Refer to the above information.Using i and I to indicate the interest rate and investment (in billions of dollars) respectively, which of the following is the correct tabular presentation of the described relationship? Assume that if the interest rate that businesses must pay to borrow funds were 20 percent, it would be unprofitable for businesses to invest in new machinery and equipment so that investment would be zero.But if the interest rate were 16 percent, businesses would find it profitable to invest $10 billion.If the interest rate were 12 percent, $20 billion would be invested.Assume that total investment continues to increase by $10 billion for each successive 4 percentage point decline in the interest rate.Refer to the above information.Using i and I to indicate the interest rate and investment (in billions of dollars)  respectively, which of the following is the correct tabular presentation of the described relationship?   A) column (A)  B) column (B)  C) column (C)  D) column (D)


Definitions:

Job Satisfaction

A measure of how content an individual is with his or her job, involving factors like work environment, task variety, compensation, and organizational culture.

Gaining Commitment

The process of securing others' support and dedication towards a particular goal or course of action.

Loyalty

A strong feeling of support or allegiance to someone or something, often manifested through consistent preference or patronage.

Organizational Context

The set of circumstances or conditions, including culture and structure, that surrounds and influences the operations of an organization.

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