When the band Alabama Shakes purchases a new tour bus, what is the effect on the economy?
A) There is no effect on the economy.
B) Prices on goods and services increase.
C) The amount of physical capital increases.
D) The firm's financial capital increases.

Question

Quizplus · Accepted Answer

Purchasing a new tour bus increases the amount of physical capital in the economy, as it adds to the stock of productive assets.

When the Band Alabama Shakes Purchases a New Tour Bus