When Interest Rates in a Given Economy Are Reduced,it Causes

question 2

Multiple Choice

When interest rates in a given economy are reduced,it causes firms to employ __________ capital goods.In terms of the production function (graphed with labor on the horizontal axis and Real GDP on the vertical axis) ,this then causes ____________________ .

• A) more; the production function to shift upward
• B) less; the production function to shift downward
• C) more; a movement up along a given production function
• D) more; a movement down along a given production function

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Definitions:

World Trade Organization

An international organization founded in 1995 designed to supervise and liberalize world trade by providing a forum for negotiations and dispute resolution.

Global Trade Agreements

Treaties or agreements between countries that facilitate trade and economic cooperation on a global scale.

Toxic Materials

Substances that are harmful or deadly to living organisms when introduced or absorbed.

Electronic Devices

Equipment that uses the principles of electronics to function, including smartphones, computers, and televisions.