Changes in consumption and investment spending due to changes in the real interest rate alter:
A. money demand.
B. autonomous expenditures.
C. induced expenditures.
D. the money supply.
Answer: B
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Economies of scale in production act as a source of:
A) legal market power. B) natural market power. C) restricted market power. D) regulated market power.
Explain how the availability of substitutes affects demand elasticity
What will be an ideal response?
Dissaving is
A) impossible in the simple Keynesian model. B) the situation when saving exceeds consumption. C) the situation when consumption spending exceeds disposable income. D) the situation when people save smaller and smaller amounts.
Suppose that a price index in Latvia was 120 in 2015 and 150 in 2016. The inflation rate between those two years was approximately:
A. 8 percent. B. 12.5 percent. C. 25 percent. D. 30 percent.