An increase in government spending will lead to which of the following?
A) an increase in equilibrium GDP,a decrease in money demand,a decrease in the interest rate,and an increase in investment spending
B) a decrease in equilibrium GDP,a decrease in money demand,an increase in the interest rate,and a decrease in investment spending
C) an increase in equilibrium GDP,an increase in money demand,an increase in the interest rate,and an increase in investment spending
D) a decrease in equilibrium GDP,a decrease in money demand,a decrease in the interest rate,and an increase in investment spending
E) an increase in equilibrium GDP,an increase in money demand,an increase in the interest rate,and a decrease in investment spending
Correct Answer:
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