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ECS2602 ASSESSMENT 3 VIDEO QUESTIONS SEM 2 OF 2026 EXPECTED SOLUTIONS

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THIS DOCUMENT CONTAINS ECS2602 ASSESSMENT 3 VIDEO QUESTIONS SEM 2 OF 2026 EXPECTED SOLUTIONS . USE THIS DOCUMENT AS A GUIDE TO SCORE ABOVE 80%.

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Question 1:

Investment spending (𝐼) increases.

Reasons:

(1) The interest rate decreases (𝑖 to 𝑖 ), making borrowing cheaper.

(2) Output increases (𝑌 to 𝑌 ), stimulating the need for greater production capacity.

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