What would happen to the planned investment function if business taxes were increased?
A)It would shift to the right.
B)It would shift to the left.
C)It would shift upward.
D)There would be no change.

Question

Quizplus · Accepted Answer

Planned investment function refers to the amount of investment firms plan to make at each possible interest rate. If business taxes were increased, firms would have less profit available to invest, which would reduce their planned investment. Therefore, the planned investment function would shift to the left.

What Would Happen to the Planned Investment Function If Business