A lower interest rate makes more investment projects profitable, meaning that:
a. there is a direct relationship between the rate of interest and the quantity of investment spending.
b. there is an inverse relationship between the rate of interest and the quantity of investment spending.
c. there is no relationship between the rate of interest and the quantity of investment spending.
d. the demand curve for investment spending is horizontal.
e. the demand curve for investment spending is vertical.
b
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Growth in GDP per capita can only occur if the growth in:
A. Output is greater than the growth in population. B. Employment is greater than the growth in prices. C. Population is greater than the growth in unemployment. D. Prices is greater than the growth in output.
Real assets are created by:
A. real economic activity, such as the construction of a house. B. government intervention. C. borrowing and lending. D. the agreement by individuals to exchange financial assets for financial liabilities.
We assume that firms, when they are deciding the best rate of output at which to produce
A. want to minimize costs. B. try to get the highest price possible. C. want to maximize profits. D. want to maximize sales.
For a corporation, issuing bonds is riskier than issuing stock.
Answer the following statement true (T) or false (F)