The SAS Curve Shifts Leftward If

question 70

Multiple Choice

The SAS curve shifts leftward if

• A) good weather increases agricultural harvests.
• B) OPEC reduces world oil prices.
• C) tax cuts stimulate labor supply.
• D) the money wage rate increases.

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Definitions:

Annual Interest Rate

The percentage of principal charged by the lender for the use of its money expressed as an annual rate.

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan balance.

Discount Rate

The interest rate that a central bank charges financial institutions for short-term loans, or the rate used in discounted cash flow analysis to determine the present value of future cash flows.

Present Value of Annuity

The current worth of a series of cash flows generated by an annuity, calculated using a particular rate of return or discount rate.