According to the Interest Rate Effect,a Fall in the Price

question 98

Multiple Choice

According to the interest rate effect,a fall in the price level will

• A)decrease the real value of money balances which causes the quantity demanded of aggregate output to increase.
• B)increase lending which causes interest rates to fall,increasing investment spending and increasing the quantity demanded of aggregate output.
• C)lead to a decrease in net exports,which causes the quantity demanded of aggregate output to decrease.
• D)increase the real value of money balances which causes interest rates to increase,reducing the quantity demanded of aggregate output.

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Definitions:

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Living organisms that belong to the kingdom Plantae, which grow and photosynthesize to produce their own food.

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A significant negative aspect or drawback that can impact effectiveness, efficiency, or desirability.

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Immune system reactions to a foreign substance that is not typically harmful to the body, such as certain foods, pollen, or pet dander.