[amp_mcq option1=”Keynes theory of interest” option2=”New established theory of interest” option3=”Hicks Henson’s theory of interest” option4=”Marginal productivity theory” correct=”option4″]<\/p>\n
The correct answer is: D. Marginal productivity theory<\/strong>.<\/p>\n The marginal productivity theory of interest is a theory of interest that states that the interest rate is determined by the marginal productivity of capital. In other words, the interest rate is the rate of return that an investor expects to earn on a loan or investment. The higher the marginal productivity of capital, the higher the interest rate will be.<\/p>\n The marginal productivity theory of interest is based on the idea that capital is a factor of production, just like labor and land. Capital is productive in the sense that it can be used to produce goods and services. The marginal productivity of capital is the additional output that is produced when one more unit of capital is used.<\/p>\n The marginal productivity theory of interest is a useful tool for understanding the determination of interest rates. It can be used to explain why interest rates are higher in some countries than in others, and why interest rates are higher for some types of loans than for others.<\/p>\n The other options are incorrect because they are not theories of interest.<\/p>\n I hope this helps! Let me know if you have any other questions.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”Keynes theory of interest” option2=”New established theory of interest” option3=”Hicks Henson’s theory of interest” option4=”Marginal productivity theory” correct=”option4″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-48719","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n\n