From the Perspective of Classical Macroeconomic Theory, an Excess of Aggregate

Multiple Choice

From the perspective of classical macroeconomic theory, an excess of aggregate spending would:

A) Increase aggregate output and the level of employment in the economy
B) Decrease the rate of interest and lower the level of investment
C) Increase consumption, and thus move the economy toward the full-employment level of output
D) Increase prices, wages, and interest rates, and thus reduce aggregate spending to equal the full-employment level of output