Figure 13-6 -Refer to Figure 13-6. Suppose Government Purchases Rise by $100

question 17

Multiple Choice

Figure 13-6
-Refer to Figure 13-6. Suppose government purchases rise by $100. In the aggregate demand/aggregate supply model,

• A) the aggregate demand curve shifts to the right by $100 at any given price level.
• B) the aggregate demand curve shifts to the right by ($100 * the multiplier) at any given price level.
• C) there is a downward movement along the aggregate demand curve such that real GDP demanded increases by $100.
• D) there is a downward movement along the aggregate demand curve such that real GDP demanded increases by ($100 * the multiplier).

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