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A Higher Inflation Rate Changes the User Cost of Capital,which

Question 110

Multiple Choice

A higher inflation rate changes the user cost of capital,which ________ the profit-maximizing level of MPK for firms,leading firms to a ________ capital-output ratio,thus ________ net investment.


A) raises,higher,raising
B) raises,lower,lowering
C) lowers,higher,raising
D) lowers,higher,lowering
E) lowers,lower,raising

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