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When businesses are optimistic about the future and invest more than they had planned, then in the short run, firms hire more workers, overall consumption
When businesses are optimistic about the future and invest more than they had planned, then in the short run, firms hire more workers, overall consumption in the economy rises, aggregate demand rises, and the price level decreases. This is because the increase in investment leads to an increase in aggregate demand, which leads to an increase in output and employment. The increase in output and employment leads to an increase in income, which leads to an increase in consumption. The increase in consumption leads to an increase in aggregate demand, which further increases output and employment 1. Therefore, option a is correct
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