According to the Keynesian transmission mechanism, a rise in the money supply will ______ the interest rate, causing a _

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According to the Keynesian transmission mechanism, a rise in the money supply will ______ the interest rate, causing a _

_____ in investment demand, which then __________ Real GDP.a. raise; fall; raisesb. raise; rise; lowersc. raise; fall; lowersd. lower; fall; lowerse. lower; rise; raises

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1 answer:

Len [333] · Answer 1 · 2022-05-15T11:17:30+03:00

Answer: The correct answer "e. lower; rise; raises".

Explanation: According to the keynesian transmission mechanism, a rise in the money supply will lower the interest rate, causing a rise in investment demand, which then raises Real GDP.

because a decrease in the interest rate, would cause companies to decide to take loans to invest, thus increasing investment and as a result would increase GDP

According to the Keynesian transmission mechanism, a rise in the money supply will __________ the interest rate, causing a _____

According to the Keynesian transmission mechanism, a rise in the money supply will ______ the interest rate, causing a _