If the investment curve is relatively flat, the Keynesian conclusion is that the transmission mechanism has little effect on the economy.

Question

Quizplus · Accepted Answer

If the investment curve is relatively flat, it means that changes in interest rates or other transmission mechanisms have a limited effect on investment. This would not lead to the conclusion that the transmission mechanism has little effect on the economy, but rather that investment is not highly responsive to these changes.

If the Investment Curve Is Relatively Flat, the Keynesian Conclusion