Choose the best reason for a rightward shift in the economy's investment demand curve.

Question

Quizplus · Accepted Answer

A rightward shift in the investment demand curve typically indicates an increase in the demand for investment goods at every interest rate. The best reason for this shift would be an improvement in technology that increases the productivity of capital, making investment more attractive. Diminishing marginal returns to capital (A) would have the opposite effect, decreasing investment demand. Changes in interest rates (C and D) would cause movements along the investment demand curve, not shifts in the curve itself.

Choose the Best Reason for a Rightward Shift in the Economy's