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Basic Question 6 of 13
If other factors are equal, a rise in interest rates can be expected to ______
B. decrease the quantity of investment.
C. have no effect upon the quantity of investment.
A. increase equilibrium income.
B. decrease the quantity of investment.
C. have no effect upon the quantity of investment.
User Contributed Comments 6
| User | Comment |
|---|---|
| Done | Wouldn't increase the amount of foreign investment or FDI(foreign direct investment)? |
| thekapila | Remember..Investment is different from savings. |
| steved333 | in econ, investment= buying real assets, lie plants and trucks and such. You will do that less when it costs more to do so. |
| mwali | very good explanation.I would have thought otherwise |
| rfvo | "increase equilibrium income" could be correct, higher interset rates lead to higher income |
| ilgibe | to rfvo: if you're talking about nominal income, yes.. |
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Learning Outcome Statements
describe tools used to implement monetary policy tools and the monetary transmission mechanism, and explain the relationships between monetary policy and economic growth, inflation, interest, and exchange rates
CFA® 2025 Level I Curriculum, Volume 1, Module 4.