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9. Answer the following with reference to the Income-Expenditure model with the planned investment function of I(r) as presented in lectures. Assume that expected returns
9. Answer the following with reference to the Income-Expenditure model with the planned investment function of I(r) as presented in lectures. Assume that expected returns on investment have risen over time after recovering from the GFC shock in 2008. (i) How would this change be represented the investment function? (ii) Noting what you found in question 6, how might changing interest rates have influenced private investment between 2011-2020? 10. From 2008, how might monetary policy (as reflected in the OCR) have affected the degree of crowding out resulting from fiscal policy (as reflected in government expenditure)
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