Use the Following to Answer Questions

question 6

Multiple Choice

Use the following to answer questions .
Exhibit: Investment Projects

-(Exhibit: Investment Projects) If the market interest rate declines from 15% to 13%, what happens to the quantity of investment demanded?

• A) It decreases by $2,200 because investment is now less profitable.
• B) It decreases by $1,000 because investment is now less profitable.
• C) It increases by $200 because investment is now more profitable.
• D) It increases by $2,200 because investment is now more profitable.

---

Definitions:

Credit Terms

The agreements between sellers and buyers that stipulate the payment amount and due dates of payments to be made for goods and services.

Invoice Price

The original price of goods or services listed on an invoice, before any discounts or adjustments are applied.

Periodic Inventory System

An inventory accounting system where the inventory balance is updated at specific intervals, requiring physical inventory counts.

Perpetual Inventory System

An inventory management system where records of inventory are updated in real-time or near real-time with every sale or purchase.