When Drawn Against the Real Interest Rate,the Output Demand Curve

question 23

Multiple Choice

When drawn against the real interest rate,the output demand curve unambiguously shifts to the right if

• A) current capital decreases.
• B) current total factor productivity decreases.
• C) future total factor productivity decreases.
• D) current or future taxes increase.

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Definitions:

Contribution Margin

Contribution margin is the amount by which a product's sales revenue exceeds its variable costs, indicating the contribution of sales towards fixed costs and profits.

Break-even Point

The financial point at which total revenue equals total costs, resulting in zero net profit or loss.

Break-even Analysis

A financial calculation to determine the point at which revenue received equals the costs associated with receiving the revenue.

Cost-volume-profit Analysis

A financial analysis tool that helps in determining the effect of changes in costs and volume on a company's profit.