1. The level of aggregate output demanded falls when the price level rises, because the resulting increase in the interest rate will lead to A. higher investment spending and lower consumption spending. B. lower investment spending and lower consumption spending. C. lower investment spending and higher consumption spending. D. higher investment spending and higher consumption spending.
1. The level of aggregate output demanded falls when the price level rises, because the resulting increase in the interest rate will lead to A. higher investment spending and lower consumption spending. B. lower investment spending and lower consumption spending. C. lower investment spending and higher consumption spending. D. higher investment spending and higher consumption spending.
Chapter9: Aggregate Demand
Section: Chapter Questions
Problem 1.2P
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![1. The level of aggregate output demanded falls when the price level rises, because the
resulting increase in the interest rate will lead to
A. higher investment spending and lower consumption spending.
B. lower investment spending and lower consumption spending.
C. lower investment spending and higher consumption spending.
D. higher investment spending and higher consumption spending.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Feb8c0a31-07e2-4f77-9347-b13ce2efb783%2Fe0de6c6c-9b20-4441-8de5-360b963436a7%2Fiy2njhq_processed.png&w=3840&q=75)
Transcribed Image Text:1. The level of aggregate output demanded falls when the price level rises, because the
resulting increase in the interest rate will lead to
A. higher investment spending and lower consumption spending.
B. lower investment spending and lower consumption spending.
C. lower investment spending and higher consumption spending.
D. higher investment spending and higher consumption spending.
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