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If government spending decreases (and GDP decreases): What will be the effect on interest rates and the price of bonds? Price of bonds decrease and

If government spending decreases (and GDP decreases): What will be the effect on interest rates and the price of bonds?

Price of bonds decrease and interest rates increase

b.Price of bonds increase and interest rates decrease

c.Price of bonds increase and interest rates increase

d.Price of bonds decrease and interest rates decrease

If Congress increases government spending:What will be the effect on output and the price level in the short-run

a.Output will increase and prices will increase

b.Output will increase and prices will decrease

c.Output will decrease and prices will increase

d.Output will decrease and prices will increase

If the Fed engages in expansionary monetary policy: in the short-run what will be the effect on AD and SRAS.

a.AD will shift right and SRAS will shift right

b.AD will shift right and SRAS will shift left

c.AD will shift right and SRAS will not shift

d.AD will not shift and SRAS will shift right

e.AD will not shift and SRAS will not shift

f.AD will not shift and SRAS will shift left

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