Suppose That Firms Expect Greater Demand for Their Products, Invest

question 41

Multiple Choice

Suppose that firms expect greater demand for their products, invest in more capital, and hire more labour.Which of the following characterizes how the economy will be affected?  

• A) Inflation will likely increase and taxation will likely rise. 
• B) The business cycle is likely to move from peak to trough. 
• C) The expected prosperity will likely be encouraged. 
• D) Consumers will probably spend less in anticipation of a decline in economic activity.

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Definitions:

Guided Therapy

A therapeutic approach where a therapist provides direction and structure to help individuals navigate through their problems.

Autobiographical Memories

Autobiographical memories are memory systems consisting of episodes recollected from an individual's life, based on a combination of personal experiences, specific objects, people, and events experienced.

Eyewitness Testimony

Evidence provided by individuals who were present at the scene of a crime that involves recounting what they observed.

Accuracy

The degree to which the result of a measurement, calculation, or specification conforms to the correct value or a standard.