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Gnom [1K]
3 years ago
10

When government expenditures increase, the interest rate

Business
1 answer:
Julli [10]3 years ago
5 0

Answer:

The correct answer is option d.

Explanation:

When there is an increase in the government expenditures, the income in the economy will increase. As a result, the demand will increase. The increase in demand will increase the price level.

The suppliers will produce more. To increase output more capital investment will be required. This will further cause an increase in the demand of loan-able funds. So, the interest rate will increase as well.

With the increase in interest rates, the cost of borrowing will increase. This will lead to lesser capital investment and as a result the aggregate demand will be smaller, because of lower production and thus lower income.

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easynotrcards Under a fixed exchange rate regime, if the domestic currency is initially undervalued, that is, above par, the cen
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Answer:

D) foreign; domestic

Explanation:

The central Bank can improve the domestic currency by using the reserves. If the domestic currency undervalued the central bank may intervene to sell the Foreign currency and purchase the domestic currency, which will increase the demand of domestic currency and increase the supply of foreign currency in the market which will improve the value of domestic currency and undervalue the foreign currency.

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falling unemployment and rising inflation.

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Answer:

The correct answer is letter "B": Extend the useful life of an asset beyond its original estimate by several years.

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Social Security Multiple Choice Is a Defined Benefit Pension Plan Is offered by local governments Is an optional Pension Plan Is
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