During a recession, O A. investment responds strongly to lower interest rates since investment and interest rates are negatively related. O B. investment increases due to higher interest rates. O C. investment may not respond positively to lower interest rates since low demand for goods leads to low capital utilization and low investment. O D. investment may not respond positively to low interest rates because of expectations of strong sales in the future.
During a recession, O A. investment responds strongly to lower interest rates since investment and interest rates are negatively related. O B. investment increases due to higher interest rates. O C. investment may not respond positively to lower interest rates since low demand for goods leads to low capital utilization and low investment. O D. investment may not respond positively to low interest rates because of expectations of strong sales in the future.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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