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In: Economics

Which of the following is correct? a. An increase in the money supply causes the interest...

Which of the following is correct? a. An increase in the money supply causes the interest rate to decrease so that aggregate demand shifts right. b. An increase in stock prices reduces consumption spending so that aggregate demand shifts left c. A recession in other countries reduces U.S. net exports so that U.S. aggregate demand shifts left. d. All of the above are correct.

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Expert Solution

Ans is D

all of the above situation are correct

an increase in money supply will decreases interest rate which will lead to increase in investment rate and an increase in aggregate demand.

Rahul Sunny answered 2 years ago
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