Discuss the level of planned investment spending

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Reference no: EM131530610

Question: Explain how each of the following actions will affect the level of planned investment spending and unplanned inventory investment. Assume the economy is initially in income-expenditure equilibrium.

a. The Federal Reserve raises the interest rate.

b. There is a rise in the expected growth rate of real GDP.

c. A sizable inflow of foreign funds into the country lowers the interest rate.

Reference no: EM131530610

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