An Increase in the Price Level Decreases Planned Expenditures Because

question 395

Multiple Choice

An increase in the price level decreases planned expenditures because

• A) real wealth increases, decreasing expenditure.
• B) domestic prices rise relative to foreign prices, increasing net exports.
• C) the real interest rate rises, increasing expenditure.
• D) current prices rise relative to future prices, decreasing expenditure.

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