Multiple Choice
Use the following to answer questions:
-(Figure 7-1: Circular-Flow Model) Use Figure 7-1: Circular-Flow Model. If the circular-flow model is in equilibrium (the sum of money flowing into each box is equal to the sum of the money flowing out of it) and there is a decrease in consumer spending, holding everything else constant, which outcome is likely to occur?
A) an increase in nominal GDP
B) an increase in real GDP
C) an increase in the unemployment rate
D) an increase in the inflation rate
Correct Answer:

Verified
Correct Answer:
Verified
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