A Change in Government Purchases Shifts the Aggregate Demand Curve

question 104

Multiple Choice

A change in government purchases shifts the aggregate demand curve by an amount equal to the

• A) change in consumption * marginal propensity to consume.
• B) change in government purchases * money multiplier.
• C) change in government purchases *spending multiplier.
• D) change in the spending multiplier * change in government purchases.

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Definitions:

Stroma

The supportive tissue of an epithelial organ, tumor, gonad, etc., consisting of connective tissues and blood vessels.

Photon

A quantum of electromagnetic energy, often viewed as a particle of light with no mass that exhibits both wave and particle properties.

Wavelength

The distance from one wave peak to the next; the energy of electromagnetic radiation is inversely proportional to its wavelength.

Photosynthesis

The method through which green plants and certain other organisms utilize sunlight to create nutrients from carbon dioxide and water.