The graph depicts the current capital market. Move one or both curves to show how the market will change if firms expect economic growth to dramatically increase. 10 Savings 9. 8 Which statement will be true about firms' capital investment decisions at the new equilibrium? O Firms will only undertake projects that yield a return greater than or equal to 4%. The minimum expected return is equal to the new equilibrium interest rate of 3%. All investments that are expected to yield 0% or more 3. Investment demand will be undertaken. O Firms will only undertake projects that yield a return less than 4%. 2 3 6. 8. Investment ($ in billions) Interest rate (%)
The graph depicts the current capital market. Move one or both curves to show how the market will change if firms expect economic growth to dramatically increase. 10 Savings 9. 8 Which statement will be true about firms' capital investment decisions at the new equilibrium? O Firms will only undertake projects that yield a return greater than or equal to 4%. The minimum expected return is equal to the new equilibrium interest rate of 3%. All investments that are expected to yield 0% or more 3. Investment demand will be undertaken. O Firms will only undertake projects that yield a return less than 4%. 2 3 6. 8. Investment ($ in billions) Interest rate (%)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter18: Savings,investment And The Financial System
Section18.2: Saving And Investment In The National Income Accounts
Problem 2QQ
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