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    Exam 12: Consumption, Real GDP, and the Multiplier
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    What Happens as the Interest Rate Rises
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What Happens as the Interest Rate Rises

Question 166

Question 166

Multiple Choice

What happens as the interest rate rises?


A) The number of profitable investment opportunities declines.
B) The opportunity cost of using retained earnings to finance investment spending rises.
C) Planned investment spending also rises.
D) Planned investment spending remains constant since it depends on profit projections not interest rates.

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