If investment demand becomes less responsive to changes in interest rates, which of the following is true?
a. An expansionary fiscal policy results in less crowding out.
b. An expansionary fiscal policy results in more crowding out.
c. An expansionary monetary policy is more effective.
d. A contractionary monetary policy is more effective.
e. An expansionary monetary policy results in more crowding out.

Question

19-12-2022
Business

Answered

If investment demand becomes less responsive to changes in interest rates, which of the following is true?
a. An expansionary fiscal policy results in less crowding out.
b. An expansionary fiscal policy results in more crowding out.
c. An expansionary monetary policy is more effective.
d. A contractionary monetary policy is more effective.
e. An expansionary monetary policy results in more crowding out.

Answer :

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Tutorconsortium436 Tutorconsortium436 · Answer 1 · 2022-12-24T02:58:44-05:00

This is the best choice if stock market is less responsive to interest rate movements. It is better to have a contractionary or demand monetary policy.

What does demand mean in terms of business?

Businesses and customers are quite familiar with the idea of demand because it feels right and happens organically throughout the course of almost any day. . For instance, consumers who are paying close attention on a product will purchase more of it when the price is low.

How would you define demand?

Demand seems to be the consumer's intention to buy a specific product or service. The need for a specific good on the market is known as market demand. The whole demand for services and goods in the industry is known as aggregate demand.

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