Investment is perfectly insensitive with respect to the interest rate if... A very small change in interest
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Question:
Investment is perfectly insensitive with respect to the interest rate if...
- A very small change in interest generates a large change in investment.
- A change in interest by 1% leads to a change in investment of less than 1%.
- A change in interest by 1% leads to a change in investment by more than 1%.
- A very large change in interest does not change investment.
Related Book For
Equity Asset Valuation
ISBN: 978-0470571439
2nd Edition
Authors: Jerald E. Pinto, Elaine Henry, Thomas R. Robinson, John D. Stowe, Abby Cohen
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