The Initial Impact of the Repeal of an Investment Tax

question 3

Multiple Choice

The initial impact of the repeal of an investment tax credit is to shift

• A)aggregate demand right.
• B)aggregate demand left.
• C)aggregate supply right.
• D)aggregate supply left.

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Definitions:

Coupon Rate

The interest rate paid by bond issuers on the bond's face value.

Cost of Debt

The effective rate that a company pays on its total debt, representing the cost of borrowing funds.

Coupon Rate

The annual interest rate paid by a bond issuer to the bondholders, expressed as a percentage of the bond's face value.

Par

Par value is the nominal or face value of a bond, share of stock, or coupon as stated by the issuer, which may not always reflect the market value.