The interest rate effect states that an increase in the price level will cause:
a. a decline in the interest rate.
b. a decrease in investment and aggregate expenditures.
c. an increase in the equilibrium level of income.
d. a decrease in the supply of financial assets.
e. an increase in real wealth.
b
Economics
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Using the above figure, suppose that roses are a normal good. If there is an increase in income
A) the equilibrium price will rise above $25 per dozen roses. B) the equilibrium quantity will decrease below 10 dozen roses. C) we cannot predict what will happen to the equilibrium price. D) we cannot predict what will happen to the equilibrium quantity.
Economics
U.S Postal Service spending is generally not included in total government expenditures
a. True b. False
Economics