Which of the Following Is a Reason Why Decreases in the Price

question 248

Multiple Choice

Which of the following is a reason why decreases in the price level result in a rise in aggregate expenditure?

• A)Price level decreases cause firms and consumers to hold less money,which lowers the interest rate.Lower interest rates raise consumption and planned investment expenditures,which raises aggregate expenditure.
• B)Price level decreases reduce real wealth,which causes consumption spending and aggregate expenditure to rise.
• C)As the price level falls,government spending rises,which raises aggregate expenditure.
• D)Price level decreases in the United States relative to other countries' lower net exports,which raises aggregate expenditure.

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Shortened

Made smaller in length, duration, or extent.

Metamorphic Grade

A classification of the degree of metamorphism or the extent of crystalline, structural, and chemical changes that have occurred in a rock due to heat, pressure, and chemical processes.

Banded Rocks

Rocks displaying layers or bands of varying composition and color, often a result of different historical geological processes.

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A region covered predominantly with grass, either in natural settings such as a prairie or as a designed part of landscapes.