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liquidity, solvency solvency, liquidity bank run, speculation speculation, bank run nvestment demand is negatively related to  ...

liquidity, solvency

solvency, liquidity

bank run, speculation

speculation, bank run

nvestment demand is negatively related to      and positively related to   .

business expectations, the interest rate

the interest rate, bullish expectations

the interest rate, bearish expectations

income, expectations
Business   Economics   
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Answer #1

Investment demand is negatively related to interest rates since at higher interest rates it is costly to borrow funds for investment. Similary, when the interest rates are lower it is cheaper to borrow funds for investment.

Investment demand is positively related to bullish expectations. A bullish sentiment refers to an optimistic market where prices of securities and sectors are expected to rise.

Thus the correct answer is: b. The interest rate, bullish expectations.

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