Which statement is FALSE?
A) A rise in the price level lowers real wealth and results in a lower level of consumer spending.
B) A rise in the price level increases the demand for money, raises the interest rate, and reduces investment spending.
C) A fall in the price level will generally lead to a rise in the level of aggregate output demanded.
D) A fall in the price level will reduce the demand for money, raise the interest rate, and increase investment spending.

Question

Quizplus · Accepted Answer

D is false. A fall in the price level may reduce the demand for money, raise the interest rate, but it can reduce investment spending.

Which Statement Is FALSE