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The Questions with Which Chapter 7 Is Concerned Include Each

Question 4

Multiple Choice

The questions with which Chapter 7 is concerned include each of the following except:


A) In the flexible-price model, what keeps aggregate demand and the level of production equal to potential output?
B) In the flexible-price model, what makes the supply of funds - saving - equal to the demand for funds - . investment - in the financial markets?
C) When saving or investment demand changes, what happens in the fixed-price model to the real output level, and why?
D) As government policies, the international economic environment, or other features of policy change or the economic environment change, what happens in the flexible-price model to consumption, investment, government, and net export spending?

Correct Answer:

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