Author Question: When the price level declines A) the interest rate falls, and consumers borrow more funds, which ... (Read 73 times)

Jipu 123

  • Hero Member
  • *****
  • Posts: 569
When the price level declines
 
  A) the interest rate falls, and consumers borrow more funds, which causes a movement down along the aggregate demand curve.
  B) interest rates fall, and consumers borrow more funds, which causes the aggregate demand curve to shift to the left.
  C) the interest rate rises, and consumers borrow fewer funds, which causes a movement up the aggregate demand curve.
  D) the interest rate is not affected, so there is no movement along the aggregate demand curve.

Question 2

The level of employment in an economy determines its real GDP, other things held constant. Do you agree or disagree? Why? What assumptions are necessary for your conclusion based on the classical model?
 
  What will be an ideal response?



xMRAZ

  • Sr. Member
  • ****
  • Posts: 363
Answer to Question 1

A

Answer to Question 2

Agree. Production requires workers so the more workers that are employed the greater total production. This assumes that workers who are employed actually work and are productive.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Thyroid conditions may make getting pregnant impossible.

Did you know?

HIV testing reach is still limited. An estimated 40% of people with HIV (more than 14 million) remain undiagnosed and do not know their infection status.

Did you know?

There are over 65,000 known species of protozoa. About 10,000 species are parasitic.

Did you know?

Congestive heart failure is a serious disorder that carries a reduced life expectancy. Heart failure is usually a chronic illness, and it may worsen with infection or other physical stressors.

Did you know?

Oliver Wendell Holmes is credited with introducing the words "anesthesia" and "anesthetic" into the English language in 1846.

For a complete list of videos, visit our video library