Question
Assume that for the entire business sector of the economy there is $1 worth of investment projects that will yield an expected rate of return
Assume that for the entire business sector of the economy there is $1 worth of investment projects that will yield an
expected rate of return of 25 percent or more. But there are $9 worth of investments that will yield an expected rate
of return of 20-25 percent; another $14 with an expected rate of return of 15-20 percent; and similarly an additional
$21 of investment projects in each successive rate of return range down to and including the 0-5 percent range. refer to the above information. if the real interest rate is 15 percent, which amount of investment will be undertaken?
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