Investment in Capital Goods Only Makes Sense When

question 41

Multiple Choice

Investment in capital goods only makes sense when

• A) the capital goods can be used to increase the future output of consumption goods.
• B) the savings rate of a country is low.
• C) the interest rate is high and people have a positive rate of time preference.
• D) economies are organized along capitalist lines.

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Definitions:

Simple Reflexes

Basic, involuntary responses to stimuli, such as the knee-jerk reflex, that are mediated by the spinal cord and brainstem.

Cognitive Structures

Mental frameworks or patterns that help individuals organize and interpret information.

Perceptual Abilities

The capacity to interpret, analyze, and give meaning to sensory information.

Concrete Operational

A stage in Piaget's theory of cognitive development where children gain the ability to think logically about concrete events and understand the concept of conservation.