if a machine yields an annual and indefinite straem of $100 income, the price of the machine is P, and the interest rate is i percent, then a firm should buy the machine ifa, 21. the higher the interest rate, ceteris paribus,a, the more profitable a given capital good investment will beb, the lower will be a firm's euilibrium capital stockc, the higher is the present value of the income stream produced by a capital goodd, all of the above22. The MEC curve shifts to the right asa, capital is accumulatedb, the interest rate fallsc, technology improvesd, more investment occurs23. an investment in human capitala, is a contradiction in terms since capital applies only to machines and plantb, applies to all investment since labor is embodied in the production of all machinesc, refers to resourcs devoted to increasing the productivity of people d, refers to investment in machines that replace labor on the production line
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