If the government wanted to reduce interest rates without ...

[fox]

If the government wanted to reduce interest rates without changing output, it should
 
  a. increase consumption and reduce the money supply.
  b. increase the money supply and raise government spending.
  c. increase the money supply and raise taxes.
  d. both b and c.

Question 2

According to the classical model shown above, an autonomous decline in investment shifts the investment schedule to the left. Furthermore, the equilibrium interest rate declines. Distance A describes an interest rate induced
 
  a. decline in saving, which is an equal increase in consumption.
  b. increase in investment.
  c. decrease in investment.
  d. decline in saving, which exceeds the increase in consumption.

[Kdiggy]

Answer to Question 1

C

Answer to Question 2

A

[fox]

Thank you

[Kdiggy]

Happy to help you