Stabilization Policy Refers to the Use Of

question 48

Multiple Choice

Stabilization policy refers to the use of:

• A)Only fiscal policy
• B)Only monetary policy
• C)Either fiscal or monetary policy
• D)Policy to shift the long-run aggregate supply curve

---

Definitions:

Discount Rates

The interest rate used in discounted cash flow (DCF) analysis to determine the present value of future cash flows.

Cost of Equity

The return a company requires to decide if an investment meets capital return requirements, often used in capital budgeting to evaluate potential projects.

Equity Capital

Funds raised by a company through the sale of common or preferred stock.

Cost of Capital

The necessary return rate on investments a firm must attain to keep its market price stable and appeal to investors.