Everything Else Remaining the Same, an Increase in the Interest

question 43

Multiple Choice

Everything else remaining the same, an increase in the interest rate increases saving and

• A)increases aggregate demand through the international substitution effect.
• B)decreases aggregate demand through the international substitution effect.
• C)increases aggregate demand through the intertemporal substitution effect.
• D)decreases aggregate demand through the intertemporal substitution effect.
• E)increases aggregate demand through the wealth effect.

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