Ceteris paribus, as real GDP expected growth ________, investment spending ________.
A) increases; decreases
B) increases; increases
C) decreases; increases
D) changes; does not usually change

Question

Quizplus · Accepted Answer

Ceteris paribus, when real GDP expected growth increases, it generally leads to an increase in investment spending. This is because higher expected growth improves business outlooks, making firms more likely to invest in new projects and expansion.

Ceteris Paribus, as Real GDP Expected Growth ________, Investment Spending