Question

fiunction (AE is flamer than the C+HG function a the margialpopemsity to consume is usualy less than 1. the marginal propensity to iort is greater than1 and govemment spending(G) are assumed to be autonomous theme is a leakage from the agpregate expenditures fiunction in the form of savings 22 Lower interest raties on business loans usuailly result in a(a): a decrease in aggregate supply. b. decrease aggregate de- c. inn…ǐn aggregate supply d increase in aggregate demand e decrease in investment 23 Conssider the following statement: If the government attempts to raise employment through increased government purchases of goods and services, all it will end up doing will be to increase the aggregate price level." The statement rests on the assumption a the aggregate demand curve is a horizontal line h the aggregate supply curve is a vertical line. d the aggregate supply curve is downward-sloping e the aggregate supply curve is a borizontal line 2 when real GDP is at F AE real GDP d the economy has achieved e there is pressure for the