Question: Using one the four scenarios referred to in the chapter, choose periods when each scenario has occurred in the U.S. or other countries:
Scenario 1: Decreased shift in the demand for capital occurs in an economic downturn or recession. The economy stops growing, the real estate market collapses, and new building permit stops. The result? Lower interest rates and less capital invested.
1. higher interest rates, more capital invested
2. lower interest rates, less capital invested
3. lower interest rates, more capital invested
4. higher interest rates, less capital invested