Business, 09.04.2021 01:00 monk68

Recent releases of leading economic indicators have been a mixed bag: Some of them indicate stable economic growth, while others indicate a looming recession. a. How will businesses likely adjust their investment spending as a result of the increased uncertainty? They will increase their investment spending, as there is a chance that the economy will boom. They will continue with their original plans, disregarding the increased uncertainty. They will reduce their investment spending, as returns to investment projects become more unpredictable. There is no way to tell, as uncertainty leads businesses to behave in unpredictable ways. b. The increased uncertainty will lead to a GDP and a more output gap.

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