In an Aggregate Demand and Aggregate Supply Graph, a Contractionary

question 158

Multiple Choice

In an aggregate demand and aggregate supply graph, a contractionary fiscal policy can be illustrated by a:

• A)leftward shift in the aggregate demand curve.
• B)rightward shift in the aggregate demand curve.
• C)rightward shift in the aggregate supply curve.
• D)movement along an existing aggregate supply curve.

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Definitions:

Market Equilibrium

A condition or state in which market supply equals market demand, meaning that prices are stable and the quantity of goods supplied exactly matches the quantity demanded.

Producing

The action of making or manufacturing from components or raw materials.