Which of the Following Would Increase Gross Private Domestic Investment

question 74

Multiple Choice

Which of the following would increase gross private domestic investment in an economy?

• A) An increase in the shares of Apple stock owned by households.
• B) An increase in the number of workers Apple hires.
• C) An increase in the level of Apple's inventory.
• D) An increase in the number of highway construction projects the government is funding.

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Definitions:

Plowback Ratio

The proportion of the firm’s earnings reinvested in the business (and therefore not paid out as dividends). The plowback ratio equals 1 minus the dividend payout ratio.

Expected Growth Rate

The anticipated rate at which an investment, economy, or other financial entity will grow over a certain period.

Rate of Return

The outcome in terms of profit or loss on an investment over a designated period, presented as a percentage of the investment’s first cost.

Dividend

A part of a company’s profits given out to its shareholders, usually as cash or more shares.