Answer :
The relationship between the interest rate and investment can be described using a table, graph, and equation.
Table:
Interest rate Investment
16% 0
14% $5 billion
12% $10 billion
10% $15 billion
8% $20 billion
6% $25 billion
Graph Can't be put here.
Equation:
i = -2I + 16
In this equation, i is the interest rate, I is the level of investment, and the values of a (the vertical intercept) and b (the slope of the line) are calculated as follows:
a = 16
b = -2
The negative value of b indicates that as the interest rate decreases, the level of investment increases. This is consistent with the data in the table and the shape of the line in the graph.
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