Author Question: In the classical model, the level of business investment was a function of a. only the expected ... (Read 48 times)

Redwolflake15 · **on:** Jun 30, 2018

In the classical model, the level of business investment was a function of

a. only the expected profitability of investment projects.
b. only the real interest rate.
c. both the expected profitability of investment projects and the real interest rate.
d. only the nominal interest rate.
d. None of the above

Question 2

A lower interest elasticity of investment demand leads to a

a. steeper IS curve.
b. flatter IS curve.
c. steeper LM curve.
d. flatter LM curve.