Which of the Following Will Not Cause Consumption, and as a Result

question 33

Multiple Choice

Which of the following will not cause consumption, and as a result, aggregate demand, to increase?

• A)an optimistic business forecast of future income growth
• B)a tax cut
• C)an increase in consumer confidence
• D)a tax increase
• E)increased consumer wealth

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Definitions:

Qualitative Characteristic

A feature used to describe or categorize non-quantitative aspects of items, events, or conditions, often used in accounting and finance to evaluate factors that are not numerically based.

Internal Rate

Often referring to the internal rate of return (IRR), it is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Capital Investment

Funds spent by a company to acquire or upgrade physical assets to further its long-term goals and operations.

Present Value

The value of a future amount of money in today's dollars, calculated by applying a discount rate to account for the time value of money.