Figure 21-1 -Refer to Figure 21-1. Which of the Following Is Consistent

question 46

Multiple Choice

Figure 21-1
-Refer to Figure 21-1. Which of the following is consistent with the graph depicted above?

• A) An expected recession decreases the profitability of new investment.
• B) Technological change increases the profitability of new investment.
• C) The government runs a budget surplus.
• D) Households become spendthrifts and begin to save less.

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Definitions:

Statute of Frauds

This refers to a legal concept requiring certain types of contracts to be in writing and signed in order to be legally enforceable.

Prenuptial Agreement

A legal contract entered into before marriage specifying the distribution of assets and financial responsibilities in the event of divorce or death.

Donee Beneficiary

A third party who benefits from a contract in which a promisor agrees to give a gift to the third party.

Incidental Beneficiary

A person who indirectly benefits from the fulfillment of a contract or agreement but has no legal right to enforce the agreement.