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If the Real Interest Rate in the Economy Is I

Question 65

Multiple Choice

If the real interest rate in the economy is i and the expected rate of return on additional investment is r, then, other things equal,


A) more investment will be forthcoming when i exceeds r.
B) less investment will be forthcoming when r rises.
C) r will fall as more investment is undertaken.
D) r will exceed i at all possible levels of investment.

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