The accelerator principle relies on investment being determined by:

waves of optimism and pessimism.
real interest rates.
nominal interest rates.
changes in consumer spending.


Below is a record of sales and inventory of a firm for three periods:

Period
Sales
Inventory at end of period
1
$90,000
$50,000
2
$90,000
$50,000
3
$80,000
$40,000

To obtain the inventory of $40,000 at the end of the third period, how much must this business purchase in the third period?

$40,000
$50,000
$70,000
$80,000


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