The Real-Balance and Interest-Rate Effects Help Explain Why Aggregate Demand

question 291

True/False

The real-balance and interest-rate effects help explain why aggregate demand might shift to the
right or to the left.

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Definitions:

Reflexes

are involuntary and nearly instantaneous movements in response to stimuli, which demonstrate the functioning of the nervous system.

Fixed-ratio Schedule

A reinforcement schedule in operant conditioning where a response is rewarded only after a specified number of responses, promoting a high and steady response rate.

Variable-interval Schedule

A reinforcement schedule in which a response is rewarded after an unpredictable amount of time has passed, which is used in operant conditioning.

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