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Author Question: If the government wanted to reduce interest rates without changing output, it should a. increase ... (Read 52 times)

fox

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on: Jun 30, 2018
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.


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Kdiggy

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Reply #1 on: Jun 30, 2018
Answer to Question 1

C

Answer to Question 2

A


fox

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Reply #2 on: Jun 30, 2018
Thank you :)


Kdiggy

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Reply #3 on: Jun 30, 2018
Happy to help you


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