Suppose That Net Investment Is Zero

question 114

Multiple Choice

Suppose that net investment is zero. We know that:

• A) the nation's capital stock has grown.
• B) the nation's capital stock has decreased.
• C) there has been no change in the capital stock.
• D) the consumption of fixed capital is also zero.

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Definitions:

Behavioral Economists

Experts in a field of economics that integrates insights from psychology to understand how people make economic decisions.

Invisible Hand

A term coined by Adam Smith to describe the self-regulating nature of the marketplace, where individual self-interests unintentionally benefit society.

Fairness

The quality of making judgments that are free from discrimination, dishonesty, or injustice.

Ultimatum Game

A game in economic experiments where one player proposes how to divide a sum of money with another, who can accept or decline the offer, with both getting nothing if declined.