In an AD-AS Model with an Upward-Sloping AS-Curve, the Most

question 26

Multiple Choice

In an AD-AS model with an upward-sloping AS-curve, the most likely effects of fiscal expansion would be

• A)an increase in prices and interest rates, but a decrease in real money balances
• B)an increase in output, prices, and real money balances
• C)an increase in consumption and a decrease in investment with no change in output
• D)a decrease in unemployment but an increase in interest rates and real money balances
• E)a decrease in consumption, but an increase in net exports and investment

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Infinitive Phrase

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