Which of the Following Statements Is True Regarding Interest Rates

question 43

Multiple Choice

Which of the following statements is true regarding interest rates and quantity of investment demanded?

• A) Higher rates of interest raise the opportunity cost of investment and therefore increase the quantity of investment demanded.
• B) Higher rates of interest lower the opportunity cost of investment and therefore reduce the quantity of investment demanded.
• C) Higher rates of interest raise the opportunity cost of investment and therefore reduce the quantity of investment demanded.
• D) Higher rates of interest lower the opportunity cost of investment and therefore increase the quantity of investment demanded.

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