As the price level in the economy increases, which of the following sequence of events occur?
a) M^d (increase) --> r (inc) --> I (inc) --> AE (dec)
b) M^d (dec) --> r (inc) --> I (inc) --> AE (inc)
c) M^d (inc) --> r (inc) --> I (dec) --> AE (dec)
d) M^d (dec) --> r (inc) --> I (dec) --> AE (dec)
Answer: c) M^d (inc) --> r (inc) --> I (dec) --> AE (dec)
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