The following list contains factors that are related to the aggregate demand curve.
1) Household expectations
2) Profit expectations
3) Degree of excess capacity
4) Personal income tax rates
5) Exchange rates
6) National income abroad
7) Government spending
8) Household wealth
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Refer to the above information. Investment spending would most likely be influenced by changes in:
A) 1 and 4.
B) 5 and 6.
C) 2 and 3.
D) 1 and 8.

Question

Quizplus · Accepted Answer

Investment spending is influenced by profit expectations (2) and the degree of excess capacity (3) as businesses decide to invest based on expected returns and current production capacity.

The Following List Contains Factors That Are Related to the Aggregate