Which of the following are likely to increase investment and as a result, aggregate demand?
A)decreased demand for investment goods
B)falling real interest rates
C)rising real interest rates
D)increased business taxes
E)All of the above.

Question

Quizplus · Accepted Answer

Falling real interest rates will decrease the cost of borrowing, making it cheaper for firms to invest. This will encourage investment, which will increase aggregate demand. The other choices, decreased demand for investment goods, rising real interest rates, and increased business taxes, are likely to decrease investment and reduce aggregate demand.

Which of the Following Are Likely to Increase Investment and as a Result