Within the Keynesian Aggregate Expenditures Model, If the Economy Is

question 29

Multiple Choice

Within the Keynesian aggregate expenditures model, if the economy is below equilibrium, then there will be:

• A) an increase the demand for goods and services.
• B) an increase in real GDP.
• C) lower interest rates, which will stimulate aggregate demand and keep the economy at full employment.
• D) a lower price level, which will quickly guide the economy to full-employment equilibrium.

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