A Ceiling on Interest Rates Is Likely to Lead to

question 128

Multiple Choice

A ceiling on interest rates is likely to lead to

• A)an increase in lending activity.
• B)more rapid capital formation by business.
• C)increases in hiring of labor.
• D)a shortage of loanable funds.

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Definitions:

Economic Order Quantity

A formula designed to determine the optimal order size to minimize the costs of holding and ordering inventory.

Net Present Value

The calculation of the present value of an investment's expected cash inflows minus the costs.

Cash Sales Policy

A policy adopted by businesses that requires all purchases to be paid for in cash at the time of sale.

Net 30 Credit Policy

A credit term indicating that payment is due in full 30 days after goods are delivered or services are performed.