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If Technological Change Increases the Profitability of New Investment for Firms

question 129

Multiple Choice

If technological change increases the profitability of new investment for firms, then the ________ curve for loanable funds will shift to the ________ and the equilibrium real interest rate will ________.


Definitions:

Amortizing

The process of gradually paying off a debt over a period of time through regular payments.

Bond Discount

The difference between the bond's face value and its selling price when the bond is sold for less than its face value.

Bond Premium

The amount by which the market price of a bond exceeds its face value.

Annual Interest Expense

The total amount of interest a company expects to pay on its debts over a year.

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