Which of the Following Is a True Statement

question 86

Multiple Choice

Which of the following is a true statement?

• A) Firms and resource suppliers generally find it easier to reduce prices than to raise them.
• B) As the price level increases, interest rates will rise and therefore consumption and investment spending will also rise.
• C) An initial increase in aggregate demand may cause a further increase in aggregate demand because higher prices mean higher incomes.
• D) A decline in aggregate demand will primarily affect real output and employment if prices are inflexible downward.