If businesses feel more optimistic about the state of the economy, then this change is likely to
A)cause a movement up the investment demand curve.
B)cause a movement down the investment demand curve.
C)shift the investment demand curve to the left.
D)shift the investment demand curve to the right.

Question

Quizplus · Accepted Answer

When businesses are more optimistic about the economy, they are likely to increase their investment, which shifts the investment demand curve to the right, indicating a higher level of investment at each interest rate.

If Businesses Feel More Optimistic About the State of the Economy