Question: Suppose that consumer spending initially rises by $ 6 billion for every 1 percent rise in household wealth and that investment spending initially rises by

Suppose that consumer spending initially rises by $6 billion for every 1 percent rise in household wealth and that investment spending initially rises by $25 billion for every 1 percentage point fall in the real interest rate. Also assume that the economy's multiplier is 3.
a) If household wealth falls by 5 percent because of declining house values, how will aggregate demand initially shift, in which direction and by how much?
b) If the interest rate falls by 2 percentage points, how will aggregate demand initially shift, in what direction and by how much?
c) If both changes happen at the same time, over the long run, what would be the net effect on aggregate demand and GDP?
Suppose that consumer spending initially rises by

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