Holding Other Factors Constant, an Incline in the Price of New

question 42

Multiple Choice

Holding other factors constant, an incline in the price of new capital goods will:

• A) increase national saving.
• B) decrease national saving.
• C) increase investment.
• D) decrease investment.

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Definitions:

Opportunity Cost

The potential benefits an individual, investor, or business misses out on when choosing one alternative over another.

Export

A good or service produced in one country and sold to buyers in another country, contributing to the selling country's gross domestic product.

Cheese

A dairy product derived from milk and produced in a wide range of flavors, textures, and forms by coagulating the milk protein casein.

Opportunity Cost

The sacrifice of prospective advantages from other possibilities when one option is selected.