Respuesta :
Answer:
Decrease of interest rates will lead to monetary expansion, however higher consumer spending in the long run would not have the same effect,as only investments lead to economic growth.
Explanation:
Capital stock is the total amount of capital used in the production of goods and services, including factories, buildings, tools and machinery. In both short and long term, decrease of interest rates, leads to monetary expansion as it becomes cheaper to borrow money and this leads to aggregate demand and supply curves shift to the right. The short run aggregate supply curve is affected by production costs, taxes and costs of labor (wages). The long run is affected by the events that change the output of the economy. In the short run, some components such as capital invested are constant, only with cheaper labor and technological progress, shifts of the curve are possible. However, changes of interest rates in both short and long term period would have the same effect. Higher consumer spending in the long run would not have the same effect as only investments cause economic growth or the increase of capital stock.
- When a Decrease in interest rates will be lead to monetary expansion, however, is that higher consumers which are spending, in the long run, would not have the same effect, as they are only investments that lead to economic growth.
- When the Capital stock is the total amount of capital that is used in the production of goods and services they are including factories, buildings, tools, and machinery. When in the short and long term, a decrease of interest rates, leads to monetary expansion as it becomes cheaper to borrow money and also that this leads to aggregate demand and also that they are supplying curves shift to the right.
- When that The short-run aggregate supply curve is affected by production costs, taxes and also affected in costs of labor (wages).
- Therefore The long run is affected by the events that are changed the output of the economy. In the short term of the run. when some components such as capital invested are constant they are only with the cheaper labor and also that technological progress, shifts of the curve are possible.
- So that However, the changes of interest rates in both short and long term periods would have been the same effect. Then Higher consumer spending in the long run but they would not have been the same effect as only investments this is the cause of economic growth or the increase of capital stock.
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