A D B E F If the interest rate on borrowing (r2) increases, what happens to consumption today? O it increases O It decreases O It's unchanged O Not enough information to answer
A D B E F If the interest rate on borrowing (r2) increases, what happens to consumption today? O it increases O It decreases O It's unchanged O Not enough information to answer
Chapter23: The Aggregate Expenditure Model
Section: Chapter Questions
Problem 1P
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Question
![Consider the following picture:
c'
A
D
B
E
F
If the interest rate on borrowing (r2) increases, what happens to consumption today?
it increases
It decreases
O It's unchanged
Not enough information to answer](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcf605b71-789d-48e0-8055-d8207016854b%2Fb724ab2a-e0e4-4db3-a072-b39b8aba8f00%2Fo432ltu_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Consider the following picture:
c'
A
D
B
E
F
If the interest rate on borrowing (r2) increases, what happens to consumption today?
it increases
It decreases
O It's unchanged
Not enough information to answer
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