An Increase in Investment Demanded Will Shift the Aggregate Demand

question 110

Multiple Choice

An increase in investment demanded will shift the aggregate demand curve to the right by an amount equal to the _________.

• A) (∆I) where ∆I = change in investment
• B) (MPC * ∆I) where MPC = marginal propensity to consume
• C) (Im * ∆I) where Im = investment spending multiplier
• D) (Mm * ∆I) where m = money multiplier

---

Definitions:

Profit-Maximized

The process or strategy by which a firm adjusts its production and sale operations to achieve the highest possible profit.

Power Cords

Electrical cables that connect an appliance to the main electricity supply, enabling its operation.

Market Wage Rate

The prevailing rate of pay for given work in a specific industry or region, determined by supply and demand for labor.

Profit-Maximizing Quantity

The level of output at which a company can make the highest possible profit, considering its cost structures and market price.