Asked by DeNae Schoel on Jul 07, 2024
Verified
Which statement is true?
A) Our capacity utilization rate is rarely over 75 percent.
B) Gross investment is generally negative.
C) The most important determinant of the level of investment is the expected profit rate.
D) None is true.
Capacity Utilization Rate
The percentage of a firm's total possible production output that is actually being achieved, indicating how efficiently resources are being used.
Gross Investment
Gross Investment refers to the total amount of money spent on new capital assets, before accounting for depreciation.
Expected Profit Rate
The forecasted return on investment, considering the potential profits and the likelihood of achieving them.
- Determine the circumstances that increase the likelihood of investment activities.
- Acquire knowledge of essential economic theories and concepts pertinent to savings and investment.
Verified Answer
XR
xAlbino Rhino5xJul 07, 2024
Final Answer :
C
Explanation :
The statement "The most important determinant of the level of investment is the expected profit rate" is true according to economic theory. Options A and B are false and Option D contradicts Option C.
Learning Objectives
- Determine the circumstances that increase the likelihood of investment activities.
- Acquire knowledge of essential economic theories and concepts pertinent to savings and investment.