Everything Else Held Constant,when Financial Frictions Increase,the Real Cost of Borrowing

question 99

Multiple Choice

Everything else held constant,when financial frictions increase,the real cost of borrowing ________ so that planned investment spending ________ at any given inflation rate.

• A)increases;falls
• B)decreases;falls
• C)decreases;rises
• D)increases;rises

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Definitions:

Esteem

Refers to the respect, admiration, and recognition an individual receives from others, and also encompasses self-esteem, which is an individual's perception of their own worth.

Conditional

Relating to conditions or stipulations that affect the outcome of an event or action.

Carl Rogers

An influential American psychologist and one of the founders of the humanistic approach to psychology, known for his theory of personality and development, and for creating client-centered therapy.

Incongruent

Pertaining to elements or situations that do not align or are mismatched, often resulting in confusion or cognitive dissonance.