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Please show your answer clearly, thanks. Consider a closed economy, and suppose investment spending depends only on the interest rate and no longer depends on

Please show your answer clearly, thanks.

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Consider a closed economy, and suppose investment spending depends only on the interest rate and no longer depends on output. Given this information, a reduction in government spending: Q will cause investment to decrease. Q will cause a reduction in output and have no effect on the interest rate. Q will cause investment to increase. Q will have no effect on investment. 0 will have no effect on output. In a closed economy, if the central bank directly targets the interest rate in response to an increase in income, the central bank will: 0 increase the target interest rate 0 reduce the money supply. 0 increase the money supply. 0 reduce the target interest rate. Q keep the money supply constant. Consider a closed economy and suppose there is a policy mix of expansionary monetary policy and expansionary fiscal policy. This combination of policies must cause: 0 an increase in the interest rate (i). O a reduction in Y. O a reduction in i. 0 an increase in investment (I). 0 an increase in output (Y)

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