Question

1. In macro short run equilibrium

Economy is in a recessionary period

Economy is in an inflationary period

Either recessionary or inflationary period

Not enough information

Which of the following would lead to change in Investment ?

Current level of income

Change in expenditure

Change in the interest rate

All of the above.

Answer 1

Q1

Option 3

Either recessionary or inflationary period

A short run equilibrium in macroeconomics is a recessionary gap or inflationary gap as the real actual output is less than the potential output means recessionary gap and the real actual output is above potential output means inflationary gap. if the both are equal then that is a long run equilibrium.

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Q2

Option 4

All of there

An increase or expenditure or interest rate in income increases interest rates and increases investments and vice verse.