Multiple Choice
When the price level increases,ceteris paribus,it causes households and firms to try to
A) reduce money balances,which drives interest rates down.
B) reduce money balances,which drives interest rates up.
C) reduce money balances,which drives national income up.
D) increase money balances,which drives interest rates down.
E) increase money balances,which drives interest rates up.
Correct Answer:
Verified
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