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If There Is an Exogenous Increase in Investment Spending, Monetarists

Question 3

Multiple Choice

If there is an exogenous increase in investment spending, Monetarists argue that there would be little or no effect on real output because the interest rate would __________, investment would __________, saving would __________, and consumption would __________.


A) decline; increase; increase; decrease
B) decline; increase; decrease; increase
C) rise; decrease; decrease; increase
D) rise; decrease; increase; decrease

Correct Answer:

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