In the Keynesian Cross Diagram,an Increase in Investment Spending Because

question 2

Multiple Choice

In the Keynesian cross diagram,an increase in investment spending because companies become more optimistic about investment profitability causes the aggregate demand function to shift ________,the equilibrium level of aggregate output to rise,and the IS curve to shift to the ________,everything else held constant.

• A)up;left
• B)up;right
• C)down;left
• D)down;right

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Definitions:

Exponential Growth

A process of increase in number or size, at a constantly growing rate.

J-shaped Curve

A concept or graphical representation showing a relationship between two variables where an initial increase in the independent variable results in a decrease in the dependent variable, followed by a significant increase.

Anti-predator Defense

Strategies and adaptations developed by animals to evade, deter, or survive attacks from predators.

Caterpillars

The larval stage of butterflies and moths, characterized by a segmented body and often distinct patterns or colors that feed voraciously before pupating.