Multiple Choice
The interest rate effect on aggregate demand indicates that a(n)
A) decrease in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending.
B) decrease in the price level will decrease the demand for money, decrease interest rates, and increase consumption and investment spending.
C) increase in the price level will increase the demand for money, reduce interest rates, and decrease consumption and investment spending.
D) increase in the supply of money will increase interest rates and decrease interest-sensitive consumption and investment spending.
Correct Answer:
Verified
Correct Answer:
Verified
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