Which of the following causes a movement along the investment demand curve?
A)A change in expenditures.
B)A change in technology.
C)A change in the rate of interest.
D)The current level of income.

Question

Quizplus · Accepted Answer

A movement along the investment demand curve is caused by a change in the rate of interest, which is represented by a change in the cost of borrowing or the expected return on investment. When interest rates decrease, investment becomes cheaper and more attractive, leading to an increase in investment demand and a movement upwards along the curve. On the other hand, an increase in interest rates makes investment more expensive and less attractive, leading to a decrease in investment demand and a movement downwards along the curve. Changes in expenditures, technology, and current income can shift the investment demand curve, but they do not cause movements along the curve.

Which of the Following Causes a Movement Along the Investment