When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?

When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?

When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?

When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?

When interest rates rise, people are able to buy fewer things.  So are businesses.  This is because it is more expensive to borrow money.  When it is more expensive to borrow, it is harder for businesses and people to buy big ticket items like cars and houses.  So that’s why it falls.We just say that the quantity demanded of real GDP (RGDP) goes down because RGDP is the X axis when we do aggregate supply and aggregate demand stuff.  When we’re doing supply and demand curves for a particular good, the X axis is quantity and the y is price, right?  But for AD and AS, the X is RGDP and the Y is the price level (CPI).
When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?
When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?
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When the interest rate effect takes place and interest rates rise, it says that "the quantity demanded of real GDP has decreased."What does that mean?
Read More