Refer to the payoff matrix. Bob's Burgers and Sam's Sandwiches are competing restaurants in a small town. Both are considering adding pizza to their line of products. If this is a sequential game and Bob's moves first, which cell represents the final outcome?

A reduction in government spending causes the equilibrium level of aggregate output to ________ at any given interest rate and shifts the ________ curve to the ________, everything else held constant

A) rise; LM; right B) fall; IS; left C) fall; LM; left D) rise; IS; right

D. a higher price level will decrease the real value of many financial assets and therefore reduce spending

A. increase the amount of U.S. real output purchased. B. increase U.S. imports and decrease U.S. exports. C. increase both U.S. imports and U.S. exports. D. decrease both U.S. imports and U.S. exports.