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An Increase in Government Purchases Causes the IS Curve to Shift

question 62

Multiple Choice

An increase in government purchases causes the IS curve to shift ________ and the aggregate demand curve to shift ________.


Definitions:

Static Planning Budget

A budget based on a fixed level of activity that does not change with actual levels of output, sales, or other activity measures.

Controlled Costs

Costs that can be influenced or managed by decisions made by managers or company officials.

Actual Costs

Actual costs refer to the genuine expenses incurred in the production, acquisition, or sale of products or services, including materials, labor, and overhead expenses.

Actual Level

The real, observed value or volume of output, production, or activity in a given period.

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