Solved

Figure 16-4

Question 342

Multiple Choice

Figure 16-4. On the figure, MS represents money supply and MD represents money demand.
Figure 16-4. On the figure, MS represents money supply and MD represents money demand. -Refer to Figure 16-4. Which of the following events could explain a decrease in the equilibrium interest rate from r<sub>3</sub> to r<sub>1</sub>? A) a decrease in the price level B) a decrease in the number of firms building new factories and buying new equipment C) an increase in the price level D) an increase in the number of firms building new factories and buying new equipment
-Refer to Figure 16-4. Which of the following events could explain a decrease in the equilibrium interest rate from r3 to r1?


A) a decrease in the price level
B) a decrease in the number of firms building new factories and buying new equipment
C) an increase in the price level
D) an increase in the number of firms building new factories and buying new equipment

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q13: A decrease in government spending initially and

Q18: If businesses and consumers become pessimistic,the Federal

Q31: Initially, the economy is in long-run equilibrium.

Q66: Which of the following shifts aggregate demand

Q74: Liquidity refers to<br>A)the relation between the price

Q100: The interest rate would fall and the

Q109: Changes in monetary policy aimed at reducing

Q196: An increase in the money supply decreases

Q204: Suppose that the government increases expenditures by

Q339: Figure 16-3.<br> <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4797/.jpg" alt="Figure 16-3.