An Increase in the Expected Future Marginal Product of Capital

question 42

Multiple Choice

An increase in the expected future marginal product of capital would cause the IS curve to

• A)shift up and to the right.
• B)shift down and to the left.
• C)remain unchanged.
• D)remain unchanged if firms face borrowing constraints; otherwise, shift down and to the left.

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Definitions:

Cost of Goods Sold

Represents the direct costs attributable to the production of the goods sold by a company.

Ending Inventory

Ending inventory is the total value of all products, raw materials, and finished goods that are not sold at the end of an accounting period.

LIFO Perpetual

An inventory valuation method where the last items added to inventory are assumed to be the first sold, updated continuously throughout the accounting period.

Cost of Goods Sold

The direct costs attributable to the production of goods sold by a company.