How does a cut in interest rates that increases investment affect the quantity of real GDP demanded, the aggregate demand curve, real GDP, and the price level?
What will be an ideal response?
The increase in investment increases the aggregate quantity demanded and shifts the AD curve rightward. As a result, the equilibrium price level rises and the equilibrium real GDP increases.
Economics
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An increase in consumer wealth shifts the consumption function upward
a. True b. False Indicate whether the statement is true or false
Economics
The aggregate demand curve has an upward slope due to the positive relationship between the price level and aggregate quantity demanded
a. True b. False Indicate whether the statement is true or false
Economics