Changes in Real Planned Investment Spending Have

question 93

Multiple Choice

Changes in real planned investment spending have

• A) a direct relationship to changes in interest rates.
• B) an inverse relationship to changes in the interest rate.
• C) no identifiable relationship to changes in the interest rate.
• D) a direct relationship to changes in the level of household savings.

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Definitions:

Cash Flow Hedge

A type of financial hedge that protects against exposure to cash flow risk or uncertainty from variable cash inflows or outflows.

Spot Rate

The existing rate at which a certain currency is available for immediate purchase or sale.

Forward Contract

A financial derivative instrument between two parties to buy or sell an asset at a specified future time at a price agreed upon today.

Settlement Date

The date on which a trade is finalized and the buyer must make payment and the seller deliver the asset.