In the Absence of Technological Progress,we Know with Certainty That

question 31

Multiple Choice

In the absence of technological progress,we know with certainty that an increase in the saving rate will cause which of the following?

• A)increase steady state consumption
• B)decrease steady state consumption
• C)have no effect on steady state consumption
• D)increase steady state consumption only if the increase in saving exceeds the increase in depreciation
• E) increase steady state consumption only if the increase in saving is less than the increase in depreciation

---

Definitions:

Earnings Per Share

A measure of a company's profitability that calculates the portion of a company's profit allocated to each outstanding share of common stock.

Market Price

The current financial demand for buying or selling a service or asset.

Debt Issue

Refers to a financial obligation or securities, such as bonds, that are issued by a company in order to raise funds.

Capital Structures

Refers to the way a corporation finances its assets through a combination of debt, equity, or hybrid securities.