Figure 9.1 -Refer to Figure 9.1. a Reduction in the Money Supply

question 32

Multiple Choice

Figure 9.1
-Refer to Figure 9.1. A reduction in the money supply causes:

• A) the aggregate demand curve to shift from AD₁ to AD₀.
• B) the aggregate demand curve to shift from AD₁ to AD₂.
• C) the economy to move from Point A to Point B, but will not shift the aggregate demand curve.
• D) neither a shift of the aggregate demand curve nor a change in real GDP.

---

Definitions:

Social Exchange Theory

A sociological and psychological theory that explains social change and stability as a process of negotiated exchanges between parties.

Business Transaction

A financial exchange or activity that occurs between parties in the course of business.

Three-Factor Theory

A psychological theory that categorizes the sources of motivation into three factors: autonomy, competence, and relatedness.

Cultural Determinant

A factor, often related to beliefs, values, or norms, within a culture that influences behaviors or outcomes within that society.