how is there a negative relation between rate of interest and investment demad?

Dear Student, there do exists a negative relationship between rate of interest and investment. If people expects interest rates to rise in near future, then in order to earn higher profits, they make investment at the present time period. On the other hand, if they expect interest rates to drop, then to avoid loss making scenario, then withdraw their respective investment. Hence, if we plot investment against interest rate, then we get a downward or negative sloping investment curve. This has been explained in the study material of Chapter-4 (named as 'Income Determination') of Macroeconomics, Lesson-1.
 

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