According to the Interest Rate Effect, an Increase in the Price

question 164

Multiple Choice

According to the interest rate effect, an increase in the price level, if other factors are held constant, will lead to

• A) a reduction in total real spending on interest-rate-sensitive goods.
• B) an increase in the stock of real wealth held by the public.
• C) an outward shift of the aggregate demand curve.
• D) an increase in the real interest rate.

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