Question

The downsloping aggregate demand curve can be explained by multiple choice 1 the investment effect, the real-balances effect, and the international effect. the investment effect, the real-purchases effect, and the foreign purchases effect. the interest-rate effect, the real-balances effect, and the foreign purchases effect. the interest-rate effect, the real-purchases effect, and the foreign purchases effect.

Answer 1

Answer:

Option C seems to be the appropriate response.

Explanation:

• The interest Rate effect would be characterized by the ability besides rising prices to significantly boost the value of the currency, increase inflation as well as, as either a direct consequence, massively reduce government expenditure as well as output growth throughout the economic system, as well as likewise.
• The real Balance effect would be characterized by the ability besides increased costs to significantly reduce the actual value of even more completely fixed finance investments as well as conversely.
• Foreign trade fallacy exists whenever U.S price levels start rising, international investors consider buying fewer U.S products, as well as Americans, decide to buy the most imported products.

Exports are falling, as well as imports are rising, causing significant growth.

Those certain decisions are not related to that same case in question. So the option above would be accurate.