Assume That for the Entire Business Sector of a Private

Multiple Choice

Assume that for the entire business sector of a private closed economy, there are $0 worth of investment projects that will yield an expected rate of return of 25 percent or more.But there are $15 worth of investments that will yield an expected rate of return of 20-25 percent, another $15 with an expected rate of return of 15-20 percent, and an additional $15 of investment projects in each successive rate of return range down to and including the 0-5 percent range.The expected rate of return curve

A) shows a direct relationship between the interest rate and investment.
B) is also the investment demand curve.
C) is indeterminate.
D) implies a direct (positive) relationship between the interest rate and the level of GDP.