Which of the following will result as part of the interest rate effect when the price level rises?
a. Households and firms increase their holdings of money.
b. Interest rates will increase.
c. A lower quantity of real GDP will be demanded.
d. All of the above will result as part of the interest rate effect when the price level rises.
Question 2
Increased domestic imports and higher international trade deficits are possible results of government surpluses.
a. True
b. False
Indicate whether the statement is true or false
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