26. Suppose the government eliminated social programs like food stamps for the poor and social security payments for the elderly. All else equal, this reduction_ income and _ in would _disposable aggregate demand. a) transfer payments; reduce; increase b) transfer payments; reduce; decrease c) tax payments; reduce; decrease d) tax payments; increase; decrease e) transfer payments; increase; increase 27. The government of Dodgetopia a large public works bill that increase government spending on road and rail construction, and the expansion Of several air and sea ports. This kind of government spending is intended to a) decrease aggregate demand and real GDP b) increase demand and decrease real GDP C ) increase aggregate demand and real G DP d) increase aggregate demand and the unemployment rate e) decrease aggregate demand and the unemployment rate 28. The central bank of Dodgetopia decides that the nation would be better served if interest rate were increased. This decision is intended to a) decrease aggregate demand and real domestic product (GDP) b) increase aggregate demand and decrease real GDP C) increase aggregate demand and real GDP d) increase demand and the unemployment rate e) decrease aggregate demand and the unemployment rate 29. The central bank Of Dodgetopia decides that interest rates in the nation are above the target levels, and the bank acc to lower them. How will this decision affect aggregate demand in the country? a) Investment spending increases, net exports decrease, and aggregate demand rises. b) Investment spending increases, consumption spending increases, and aggregate demand falls. C ) Investment spending decreases, net exports decrease, and aggregate demand falls. d) Consumption spending increases, net exports decrease, and aggregate demand rises. e) Investment spending increases, net exports increaser, and aggregate demand rises 30. If a central bank that total spending in the economy is high, they should act to_ _interest rates so that a) increase, investment, interest sensitive consumption and net exports all rise b) increase, investment, interest sensitive consumption and net exports all fall c) decrease, investment rises, interest sensitive consumption and net exports both fall d) decrease, investment, interest sensitive consumption and net exports all rise e ) decrease, investment, interest sensitive consumption and net exports all fall 5