The Great Invention

1415-NNH14 -V1

Level N Economics HW

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1415 – Economics Term 1 Week 5 Week 5 (Sept. 28 – Oct. 02) Homework : NNH14
Sample Questions Exam

1. Investment has a major effect on ________________ and ______________ in the short-run. Fill in the gaps.

Reference:

Economics Level N Chapter 6 Introduction, Page 82

Solution:

Investment has a major effect on employment and output in the short run

2. What are the determinants of investment?

Reference:

Economics Level N Unit 6.1, Page 82

Solution:

Rate of interest, revenues, corporation tax, government incentives, changes in technology and business expectations.

3. What is the effect of investment, in the long run and short run?

Reference:

Economics Level N Chapter 6 Introduction, Page 82

Solution:

Investment has a major effect on employment and output in the short run and on potential output and economic growth in the long run.

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1415-NNH14 -V1

Level N Economics HW

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4. What is the cost of borrowing?

Reference:

Economics Level N Unit 6.2, Page 83

Solution:

Interest rates

5. ____________ involves the demand for, and expenditure on, capital goods capable of producing other goods and
services in the future (Increase in productive capacity) and, therefore, generating more income and wealth in the future. Fill in the gap

Reference:

Economics Level N, Section 6.1, Page 82

Solution:

Investment

6. Give an example of an economic investment.

Reference:

Economics Level N Unit 6.1, Page 82

Solution:

purchasing capital goods in any form which will help in the production of more capital or consumer goods in the future. Investment in human capital in the form of education and training will also increase productive capacity.

7. What factors are not considered as investment in economics?

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1415-NNH14 -V1
Reference:

Level N Economics HW

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Economics...