A Japanese Keiretsu

question 42

Multiple Choice

A Japanese keiretsu:

• A) Involves no more than 10 firms
• B) Is joined around a trading company or bank
• C) Does not minimize risks of competition
• D) Is a licensing agreement

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Definitions:

Future Consumption

The use of goods or services at a later date, often facilitated by saving or investing in the present.

Productivity of Capital Goods

The effectiveness with which capital goods, such as machinery and equipment, produce goods or services.

Loanable Funds

The money available for borrowing in the financial market, originating from people or entities who save some part of their income.

Equilibrium Interest Rate

The equilibrium interest rate is the interest rate at which the quantity of money demanded equals the quantity of money supplied, balancing savings and investments in the economy.