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sgy_89 sgy_89
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7 years ago
According to the real balance effect, a decrease in the overall price level will
A) decrease the quantity of real output demanded because households will feel poorer.
B) decrease the quantity of real output demanded because the value of savings accounts and other financial assets will decline.
C) increase the quantity of real output demanded because cheaper products will be substituted in the place of more expensive items.
D) increase the quantity of real output demanded because the purchasing power of financial assets will increase.
E) increase the quantity of real output demanded because interest rates will tend to decline, and this will stimulate spending.
Textbook 
Introduction to Economic Reasoning

Introduction to Economic Reasoning


Edition: 8th
Author:
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hecosmetichecosmetic
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7 years ago
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sgy_89 Author
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7 years ago
Thanks for your help!!
choih94
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This site is awesome
jayfo05
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2 hours ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
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