Which of the following is likely to be an effect of an increase in planned inventory on the investment demand curve of an economy?
A)A leftward shift of the curve
B)A rightward shift of the curve
C)An upward movement along the curve
D)A downward movement along the curve

Question

Quizplus · Accepted Answer

An increase in planned inventory suggests that firms are expecting higher demand in the future and are therefore increasing their investment in inventory. This will shift the investment demand curve to the right, as the quantity of investment demanded will increase at any given interest rate.

Which of the Following Is Likely to Be an Effect