Question

Which of the following is NOT likely to lead to higher Investment spending: Question 7 options:...

Which of the following is NOT likely to lead to higher Investment spending:

Question 7 options:

the Federal Reserve lowers interest rates.

the economy is entering a recession.

the economy has been expanding for a while, and it looks like it will continue to expland.

banks are making it easier to get a loan.
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Answer #1

Solution:

The economy has been expanding for a while, and it looks like it will continue to expland.

Rest three options are linked with the higher Investment spending

As when there is higher Investment spending the Federal Reserve lowers interest rates, the economy is entering recession and banks are making easier to get a loan.

In a recession, people tend to save money because there is a fall in confidence. If people expect to be made unemployed (or fear unemployment), then you don’t want to spend and borrow, saving becomes more attractive.

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