If There Is an Increase in the Future Marginal Product

question 94

Multiple Choice

If there is an increase in the future marginal product of capital in a large open economy,it causes the current account to ________ and saving to ________.

• A)fall;rise
• B)rise;remain unchanged
• C)fall;remain unchanged
• D)rise;rise

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Definitions:

Predatory Pricing

A strategy where a company sets very low prices with the intention to drive competitors out of the market or to prevent new entries.

Market Competition

The rivalry between businesses to attract customers and achieve higher sales and market share.

Monopoly Power

The exclusive control by one company over the entire supply of goods or services in a particular market or industry.

Relevant Market

The market in which a particular product or service competes, considering factors like geography, product substitutability, and consumer preferences.