Essay
Explain how each of the following events affects (i) the investment demand curve; and (ii) aggregate demand and/or aggregate supply curve.
a. an increase in interest rates b. a decrease in interest rates c. an increase in the cost of capital goods d. a decrease in the level of economic activity e. a decrease in the minimum wage f. a natural disaster that destroys much of the capital stock
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a. An increase in interest rates will le...View Answer
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Correct Answer:
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