[Solved] Who defined investment as "the construction of a new capital asset like machinery or factory building"?

McqMate

Q.	Who defined investment as "the construction of a new capital asset like machinery or factory building"?
A.	Hansen
B.	J.M. Keynes
C.	Harrod
D.	J.R. Hicks
Answer» B. J.M. Keynes
Explanation: Investment expenditure refers to the creation of new assets i.e. an addition to the stock of existing capital assets. According to Keynes investment demand depends upon two factors: (1) Expected rate of profit which he calls as Marginal Efficiency of Capital (MEC). Investment demand increases with the increase in the expected rate of profit; (2) the rate of interest (IR). Investment demand decreases with the increase in the rate of interest.

541

0

Do you find this helpful?

1

View all MCQs in

Discussion

No comments yet

Related MCQs

The upper limit of investment in plant and machinery for small-scale industries has been fixed currently at -
Investment multiplier shows the effect of investment on -
By whom was the autonomous investment separated from induced investment?
The period over which the cumulative net revenue from an investment project equals the original investment is known as:
The real capital formation e.g., the production or maintenance of machinary or construction that will produce a stream of goods and services is called
Investment in the foreign operations of a company through acquisition of a foreign operation, or establishment of a new site is called:
Plant arid machinery are -
New capital issue is placed in -
If the fixed costs of a factory producing candles is Rs 20,000, selling price is Rs 30 per dozen candles and variable cost is Rs 1.5 per candle, what is the break-even quantity?
Which of the following country will provide financial aid for the construction of Gwadar Port and Makran Coastal highway in Balochistan?