Based on the neoclassical theory of investment, which aspect of a boom

Based on the neoclassical theory of investment, which aspect of a booming economy helps to explain the procyclicality of investment?

A) Tax revenues are likely to be rising.
B) The real interest rate is likely to be rising.
C) Capital goods are becoming more expensive.
D) Financing constraints are likely to be relaxed for many businesses.

ANSWER

D