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What happens to the economy when the economy's capital stock increases?
Wiki User
∙ 13y ago
Supposing that with capital you mean physical capital (all kind of physical investments like machines, and so on), it tends to increase the Gross Domestic Product (GDP), but increases in capital along time lead to lower increases in GDP.
This is known in economics as the diminishing marginal returns.
Wiki User
∙ 13y ago
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What happens when the cost of capital increases?
The market value of a firm's equity increases, the cost of capital decreases.
What happens when a nation's currency depreciates?
Exports increase. Imports decrease. FDI increases. Foreign capital investment increases. Economic growth rises. Besides these positives there is the negative effect and thats inflation which increases.
What happens when a nation's currency depreciate?
Exports increase. Imports decrease. FDI increases. Foreign capital investment increases. Economic growth rises. Besides these positives there is the negative effect and thats inflation which increases.
If the government uses tax money to pay for long-term investments such as roads or other infrastructure what happens to the economy?
investment increases
When the price of a capital good increases what happens to the prices of related consumer goods and services Why?
Prices increase due to the increase in production costs.
What happens when the cost of capital increases?
The market value of a firm's equity increases, the cost of capital decreases.
What happens to a preferred share if the government increases capital by buying common shares of a bank?
we can became ungry
What happens when a nation's currency depreciates?
Exports increase. Imports decrease. FDI increases. Foreign capital investment increases. Economic growth rises. Besides these positives there is the negative effect and thats inflation which increases.
What happens when a nation's currency depreciate?
Exports increase. Imports decrease. FDI increases. Foreign capital investment increases. Economic growth rises. Besides these positives there is the negative effect and thats inflation which increases.
If the government uses tax money to pay for long-term investments such as roads or other infrastructure what happens to the economy?
investment increases
What happens when wbc increases?
wht happens if WBC increases?
When the price of a capital good increases what happens to the prices of related consumer goods and services Why?
Prices increase due to the increase in production costs.
When the price of a capital good increases what happens to the prices of related consumers goods and services?
Prices increase due to the increase in production costs.
When the price of a capital good increases what happens to the price of related consumer goods and services?
Prices increase due to the increase in production costs.
When the price of capital good increases what happens to the prices of the related consumer goods and services and why?
Prices increase due to the increase in production costs.
When a price of a capital good increases what happens to the prices of related consumer goods and services Why?
Prices increase due to the increase in production costs.
What happens to the real rate of interest when the demand for capital increases because technology innovations have caused the aggregate investment opportunity set to increase?
Anytime the demand for capital increases, interest rates go up. Supply and demand. The price of money is measured in interest rates.
