If Investment Spending Increases Due to Increased Optimism in the Business

question 121

Multiple Choice

If investment spending increases due to increased optimism in the business sector,which of the following would occur?

• A) an increase in GDP,an increase in the price level,an increase in money demand,and an increase in the interest rate
• B) an increase in GDP,a decrease in the price level,an increase in money demand,and a decrease in the interest rate
• C) a decrease in GDP,a decrease in the price level,a decrease in money demand,and a decrease in the interest rate
• D) a decrease in GDP,a decrease in the price level,an increase in money demand,and an increase in the interest rate
• E) an increase in GDP,an increase in the price level,a decrease in money demand,and a decrease in the interest rate

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Definitions:

Mowrer

O.H. Mowrer, an influential psychologist known for his two-factor theory of learning which combines classical and operant conditioning.

Feared Stimulus

An object, event, or situation that induces fear through conditioning or innate phobias.

Avoidance Behavior

Actions taken to prevent or evade a negative or undesirable outcome or stimulus.

Escape Behavior

A response designed to avoid an unpleasant situation or outcome, often seen in the context of avoiding negative reinforcement.