Investment is
A)a small part of real GDP, so it accounts for a small share of the fluctuation in real GDP.
B)a small part of real GDP, yet it accounts for a large share of the fluctuation in real GDP.
C)a large part of real GDP, so it accounts for a large share of the fluctuation in real GDP.
D)a large part of real GDP, yet it accounts for a small share of the fluctuation in real GDP.

Question

Quizplus · Accepted Answer

Investment, while being a smaller component of real GDP compared to consumption, has a significant impact on economic cycles. It is highly sensitive to interest rates and economic outlook, leading to large fluctuations in real GDP.

Investment Is