Other Things Equal, in the Short Run a Higher Price

question 290

Multiple Choice

Other things equal, in the short run a higher price level leads households to

• A)increase consumption and firms to buy more capital goods.
• B)increase consumption and firms to buy fewer capital goods.
• C)decrease consumption and firms to buy more capital goods.
• D)decrease consumption and firms to buy fewer capital goods.

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Definitions:

AUM

The cumulative market value of all investments managed by an individual or organization for its clients.

Net IRR

Net Internal Rate of Return is a performance measure that calculates the profitability of an investment adjusted for all cash flows and costs incurred.

Investors

Individuals or entities that allocate capital with the expectation of receiving financial returns, which can involve a variety of assets including stocks, bonds, and real estate.

AUM

Assets under management, the total market value of the investments that a person or entity manages on behalf of clients.