Explain the short-run effects on output and the price level from a decrease in the aggregate-demand curve

What does the Cobb-Douglas production function assume about the input shares in the economy?

A) the capital share is larger than the labor share of income B) both the capital and labor shares of income grow over time C) both the capital and labor shares of income remain relatively constant over time D) the capital share of income is equal to the labor share of income E) none of the above

Based on our understanding of the IS-LM model that takes into account dynamics, we know that an increase in the money supply will cause

A) an immediate increase in i and no initial change in Y. B) an immediate decrease in i and no initial change in Y. C) a gradual decrease in i and gradual increase in Y. D) none of the above