In a hypothetical economy, no investment projects are undertaken when the real interest rate is 12 percent or above, 30 projects worth $1 million each are undertaken when the real interest rate is 10 percent, and 30 more projects worth $1 million each are undertaken every time the real interest rate falls by 2percent until it reaches a value of zero.

a. Draw a graph showing the investment demand curve.Plot 7 points in total using the line tool (investment demand curve) given below.

b. If the real interest rate is 4% then $ million of investment will take place in this economy.

c. If the real interest rate rises to 6% then investment

(Click to select)

rises

falls

to $ million.