The Return on Capital Is Greater Than the Price of Loanable

question 75

Multiple Choice

The return on capital is greater than the price of loanable funds. It follows that firms will

• A)borrow funds, the capital stock will rise, and eventually the return on capital will fall.
• B)borrow funds, the capital stock will fall, and eventually the return on capital will rise.
• C)not borrow funds and, as a result, the price of credit will rise.
• D)not borrow funds and eventually the capital stock will decrease and the return on capital will fall.
• E)none of the above

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Definitions:

Maladaptive Attitudes

Persistent patterns of thought that are counterproductive and interfere with an individual's functioning or well-being.

Bulimia Nervosa

A psychological eating disorder characterized by episodes of binge eating followed by inappropriate methods of weight control, such as vomiting or excessive exercise.

Cognitive Techniques

Psychological strategies used to identify and challenge negative thought patterns, aiming to improve mental health and well-being.

Conversion Disorder

A disorder in which bodily symptoms affect voluntary motor and sensory functions, but the symptoms are inconsistent with known medical diseases.