It is most likely that a firm would borrow funds to expand its capital facilities when the
A) pure rate of interest is greater than the real rate of interest.
B) expected rate of return is greater than the interest rate.
C) demand for money is greater than the supply of money.
D) real rate of interest is greater than the nominal rate of interest.
Correct Answer:
Verified
Q225: Which of the following is incorrect?
A)The nominal
Q226: If the desired real rate of interest
Q227: Effective usury laws cause
A)a surplus of money
Q228: Q229: Suppose a firm is considering the purchase Q231: Profit-maximizing businesses will buy more new machinery Q232: Effective usury laws
A)subsidize lenders.
B)penalize those who borrow
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