Which of the following is an impact of an increase in the general price level?
a. An increase in aggregate demand for goods and services
b. A decrease in aggregate supply of goods and services
c. An increase in the price of the financial assets
d. A decrease in supply of bonds and other assets
e. An increase in interest rates
e
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How might a budget deficit affect the balance of trade?
A) A budget deficit reduces interest rates, which reduces exchange rates and reduces the balance of trade. B) A budget deficit raises interest rates, which raises exchange rates and reduces the balance of trade. C) A budget deficit raises interest rates, which raises exchange rates and increases the balance of trade. D) A budget deficit reduces interest rates, which raises exchange rates and reduces the balance of trade.
According to the Keynesian aggregate expenditures model equilibrium and full employment:
a. always occur at the same income level of real GDP. b. may differ, but there is an automatic mechanism that directs the economy toward full-employment equilibrium. c. could never occur at the same level of real GDP. d. do not necessarily occur at the same level of real GDP.