The relationship between interest rate and investment

Question

Accepted Answer

The relationship between interest rate and investment

Higher interest rates tend to discourage investment as borrowing becomes more expensive
Lower interest rates encourage investment as borrowing becomes cheaper
Investment decisions are influenced by the cost of borrowing and the potential return on investment
Higher interest rates can lead to a decrease in business investment and economic growth
Lower interest rates can stimulate investment and economic activity

Accepted Answer

The level of investment in economy is sensitive to changes in investment.if interest rate is high the investment decrease if interest rate is low investment increases.