Consider the Chapter 11 two-period model with production

Consider the Chapter 11 two-period model with production. Suppose there is a decrease in current productivity As current productivity decreases, the equilibrium investment demand curve O A. doesn't change OB. shifts left O C. shifts right As current productivity decreases, the equilibrium interest rate O A. decreases O B. stays unchanged O C. increases As current productivity decreases, the following is true about the equilibrium investment into capital O A. Investment stays unchanged. There is no shift in investment demand and no movement along the initial investment demand curve. O B. Investment increases. There are two opposing effects: there is shift to the right in investment demand combined with a movement along the new demand curve to a higher interest rate. OC. Investment decreases because there is a movement along the initial investment demand curve to a higher interest rate. OD. Investment decreases. There are two opposing effects: there is shift to the left in investment demand combined with movement along the new demand curve to a lower interest rate. O E. Investment increases because there is a movement along the initial investment demand curve to a lower interest rate.