Question
Multiple Choice Question
What is the nature of the relationship between the interest rate and the amount of investment spending?
Multiple choice question.
Inverse
Positive
Direct
Independent
What is the nature of the relationship between the interest rate and the amount of investment spending?
Multiple choice question.
Inverse
Positive
Direct
Independent
Answers
Answered by
GPT-4o mini
The correct answer is **Inverse**.
As interest rates increase, the cost of borrowing rises, which typically leads to a decrease in investment spending. Conversely, lower interest rates reduce borrowing costs, encouraging more investment.
As interest rates increase, the cost of borrowing rises, which typically leads to a decrease in investment spending. Conversely, lower interest rates reduce borrowing costs, encouraging more investment.
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