In an Aggregate Expenditures Diagram Equal Increases in Government Spending

question 205

Multiple Choice

In an aggregate expenditures diagram equal increases in government spending and in lump-sum taxes will:

• A)shift the aggregate expenditures line downward.
• B)shift the aggregate expenditures line upward.
• C)not affect the aggregate expenditures line.
• D)reduce the equilibrium GDP.

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