Because Investment, Consumption Expenditure and Net Exports Are Interest-Sensitive Components

question 48

Multiple Choice

Because investment, consumption expenditure and net exports are interest-sensitive components of expenditure, a ________ in the cash rate brings ________ in ________.

• A) fall; an increase; aggregate demand
• B) fall; a decrease; aggregate supply
• C) fall; a decrease; aggregate demand
• D) rise; an increase; aggregate demand
• E) rise; an increase; aggregate supply