Which best describes the Keynesian transmission mechanism when the money supply increases?
A) The interest rate rises; this in turn reduces investment spending, which in turn raises total expenditures and shifts the AD curve rightward.
B) The interest rate falls; this in turn stimulates investment spending, which in turn raises total expenditures and shifts the AD curve leftward.
C) The interest rate falls; this in turn stimulates investment spending, which in turn raises total expenditures and shifts the AD curve rightward.
D) The interest rate falls; this in turn stimulates investment spending, which in turn lowers total expenditures and shifts the AD curve leftward.
C
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What will be an ideal response?
____________ is the process of making a choice between two or more alternatives
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