Assuming a banking system with limited reserves, which of the following will most likely happen if a country's government decreases its spending and the central bank increases the money supply? An increase in unemployment and an appreciation of the currency. 她 A C D E An increase interest rates and a decrease in aggregate supply A decrease in interest rates and an increase. investment spending A depreciation of the currency and an increase in imports An increase in aggregate demand and unemployment

ENGR.ECONOMIC ANALYSIS
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Question 6
Assuming a banking system with limited reserves, which of the following will most likely happen if a country's government decreases its spending and the central bank increases the money supply?
A
B
C
D
E
An increase in unemployment and an appreciation of the currency
An increase in interest rates and a decrease in aggregate supply
A decrease interest rates and an increase investment spending.
A depreciation of the currency and an increase in imports.
An increase in aggregate demand and unemployment
Transcribed Image Text:Question 6 Assuming a banking system with limited reserves, which of the following will most likely happen if a country's government decreases its spending and the central bank increases the money supply? A B C D E An increase in unemployment and an appreciation of the currency An increase in interest rates and a decrease in aggregate supply A decrease interest rates and an increase investment spending. A depreciation of the currency and an increase in imports. An increase in aggregate demand and unemployment
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