Question 2 If economic growth in China is collapsing due to the pandemic and the Federal Reserve is tightening monetary policy to contain inflation, then the likely impact is to: Expand US aggregate demand because the recession in China will make it easier to sell our exports, while higher interest rates will increase household and business savings and investment. Contract US aggregate demand by raising our imports from China, while higher tax rates will reduce borrowing and spending on goods and services. Contract US aggregate demand by lowering our exports to China, while higher interest rates will reduce our consumption and investment spending. None of the statements are correct. Contract US aggregate demand by lowering our imports to China, while higher interest rates will reduce our incomes and force a decline in our spending