To reduce the effects of crowding out caused by an increase in government expenditures, the federal reserve could
a. decrease the money supply by buying government securities
b. increase the money supply by buying government securities
c. increase the money supply by selling government securities
d. increase the money supply by selling government securities

Which of the statements best describes why the aggregate demand curve is downward sloping? an increase in the aggregate price level causes consumer and investment spending to fall, because consumer purchasing power decreases and money demand increases. as the aggregate price level increases, consumer expectations about the future change. as the aggregate price level decreases, the stock of existing physical capital increases. as a good's price increases, holding all else constant, the good's quantity demanded decreases.