The difference between investment schedule and investment demand curve.
Explanation of Solution
An investment schedule depicts the levels of investment made at different levels of
Whereas, the investment demand curve shows the level of investment made at different levels of interest
If the interest rate is higher, then the cost of borrowing would be greater which in turn reduces the return from the investment. Thus, increasing interest leads to reduce the demand for investment and vice versa. There is a negative relationship exist among the demand for investment and interest rate.
Concept Introduction:
Investment schedule: An investment schedule shows the level of demand for investment at different levels of national income.
Investment demand curve: The investment demand curve depicts the value of investment projects demanded at every given interest rate.
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Chapter 11 Solutions
MACROECONOMICS W/CONNECT
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- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning