In the Keynesian-Cross Model, a Decrease in the Interest Rate

question 83

Multiple Choice

In the Keynesian-cross model, a decrease in the interest rate ______ planned investment spending and ______ the equilibrium level of income.

• A) increases; increases
• B) increases; decreases
• C) decreases; decreases
• D) decreases; increases

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Definitions:

Direct Labor-Hours

The total hours of labor directly involved in manufacturing a product, which are often used to allocate manufacturing overhead costs to products.

Direct Materials Cost

The cost of raw materials and components that are directly used in the production of a product.

Activity-Based Costing

A method of accounting in which costs are assigned to products or services based on the resources they consume.

Direct Labor-Hours

The collective work hours of personnel directly part of the production workflow.