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enot [183]
1 year ago
7

What do you mean by investment function?.

Business
1 answer:
Alenkasestr [34]1 year ago
4 0

The factors that affect the levels of total investments are summarised by the investment function.

<h3>What is investment function ?</h3>
  • The investment function refers to the link between investments and interest rates. Interest rates and investment have a functional and inverse relationship.
  • An investment function aims to explain how changes in national income lead to adjustments in how investors trade on the various domestic marketplaces. To achieve this, it is crucial to immediately link changes in the market to things happening in the economy as a whole.
  • The interest rate is a measurement of the opportunity cost of those resources, so it stands to reason that investment and interest rates are inversely correlated. There is an opportunity cost of (1+r), where r is the interest rate, if the resources could be invested in financial assets instead of financing the investment.

To learn more about investment function refer :

brainly.com/question/25893158

#SPJ4

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