Other things the same,as the interest rate rises,the present value of future revenues from investment projects
A)rise, so investment spending rises.
B)fall, so investment spending rises.
C)rise, so investment spending falls.
D)fall, so investment spending falls.

Question

Quizplus · Accepted Answer

As the interest rate rises, the present value of future revenues from investment projects falls, making them less attractive, so investment spending falls.

Other Things the Same,as the Interest Rate Rises,the Present Value