Real investment tends to be
A)procyclical and less variable than real GDP.
B)countercyclical and more variable than real GDP.
C)countercyclical and less variable than real GDP.
D)procyclical and more variable than real GDP.
E)acyclical with real GDP.

Question

Quizplus · Accepted Answer

Real investment tends to be procyclical, meaning it moves in the same direction as real GDP, and it is generally more variable than real GDP. This is because investment is often driven by expectations of future economic growth and profitability, which can be highly uncertain and volatile.

Real Investment Tends to Be