-In the Figure Above, If the Interest Rate Is 8

question 54

Multiple Choice

-In the figure above, if the interest rate is 8 per cent, people demand $3.1 billion

• A)more money than the quantity supplied and bond prices will rise.
• B)more money than the quantity supplied and bond prices will fall.
• C)less money than the quantity supplied and bond prices will rise.
• D)less money than the quantity supplied and bond prices will fall.

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Definitions:

Marginal Costs

The cost incurred by producing one additional unit of a product or service.

Total Variable Cost

The sum of all costs that vary with the level of output in the short run.

Average Fixed Costs

The fixed costs of production (expenses that do not change with the level of output) divided by the quantity of output produced.

Total Fixed Costs

The sum of all costs that do not change with the level of output produced by a business, such as rent, salaries, and insurance.