IBBI Plant & Machinery Practice Questions - IBBI Registered Valuers Examination - Plant & Machinery Asset Class Exam

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When the Reserve Bank of India raises the repo rate to control inflation, the intended short-run effect on investment demand is usually:

No change because inflation is unrelated to investment A permanent increase in plant and machinery purchases An increase because savings are discouraged A decrease because borrowing becomes more expensive

Correct Answer:

A decrease because borrowing becomes more expensive

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