Use the Aggregate Supply- Aggregate Demand Model to Determine Which

question 27

Multiple Choice

Use the Aggregate Supply- Aggregate Demand model to determine which of the following will lead to higher prices

• A)a tax increase.
• B)an increase in interest rates.
• C)a fall in world oil prices.
• D)an increase in government spending.

---

Definitions:

Capital Budgeting

The process a business undertakes to evaluate potential major projects or investments, focusing on analyzing future cash flows and profitability.

Discount Rate

The yield rate utilized within DCF analysis for determining today's value of future cash movements.

Opportunity Costs

The financial impact of bypassing the alternative that ranks immediately lower in preference while making a choice.

Net Working Capital

The difference between a company's current assets and its current liabilities, indicating the short-term financial health of the business.