The total demand for funds curve slopes downward

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Reference no: EM13771629

1. In the classical view, if government purchases rise (and there is no other fiscal change),

A) the interest rate rises.

B) employment.

C) the real wage rises.

D) output rises.

E) all of these answers.

2. The total demand for funds curve slopes downward because a rise in the interest rate causes

A) government borrowing to decrease.

B) business borrowing to decrease.

C) both government borrowing and business borrowing to decrease.

D) household saving to increase.

E) consumption spending to decrease.

Reference no: EM13771629

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