An increase in the overall price level in the economy leads to all of the following EXCEPT:
A) a decrease in consumption spending.
B) a decrease in the interest rate.
C) a decrease in its exports.
D) an increase in its imports.

Question

Quizplus · Accepted Answer

An increase in the overall price level in the economy typically leads to higher interest rates, not a decrease. Higher prices can lead to inflationary pressures, which central banks often combat by raising interest rates to cool down the economy.

An Increase in the Overall Price Level in the Economy