Answered

Welcome to Westonci.ca, your go-to destination for finding answers to all your questions. Join our expert community today! Join our Q&A platform to connect with experts dedicated to providing accurate answers to your questions in various fields. Connect with a community of professionals ready to help you find accurate solutions to your questions quickly and efficiently.

If 2 percent growth is your break-even point for an investment project, under which outlook for the economy would you be more inclined to go ahead with the investment: (1) A forecast for economic growth that ranges from 0 to 4 percent, or (2) a forecast of 2 percent growth for sure, assuming the forecasts are equally reliable? What core principle does this illustrate?

Sagot :

Answer: (2) a forecast of 2 percent growth for sure, assuming the forecasts are equally reliable.

Core principle 5 - Stability improves welfare.

Explanation:

Based on the information given, I'll be more inclined to go ahead with the investment whereby there is a forecast of 2 percent growth for sure, assuming the forecasts are equally reliable.

It should be noted that when there's uncertainty about the future, it leads to the unattractiveness of investment. Here, the core principle illustrated is Core principle 5 - Stability improves welfare.

Thanks for stopping by. We strive to provide the best answers for all your questions. See you again soon. Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Westonci.ca is your go-to source for reliable answers. Return soon for more expert insights.