The Table Shows the Projected Rate of Return and Number

question 101

Multiple Choice

The table shows the projected rate of return and number of investment projects that might be undertaken by a small firm. Each project requires an investment of $1,000. If the interest rate decreases from 25 percent to 20 percent, the quantity of loanable funds demanded by this firm

• A)increases by $1,000.
• B)increases by $3,000.
• C)decreases by $3,000.
• D)decreases by $4,000.

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Definitions:

Merchants

Individuals or entities involved in the wholesale or retail sale of goods.

Monthly Payments

Regular payments made once a month, often used in the context of loans, leases, and other forms of financing.

Accounts Receivable

Money owed to a company by its customers for goods or services that have been delivered but not yet paid for.

Assignment

The transfer of rights, property, or obligations from one party to another, often seen in contracts and legal agreements.