Which of the Following Would Cause the AD Curve to Shift

question 165

Multiple Choice

Which of the following would cause the AD curve to shift to the left?

• A)A decrease in the real rate of interest
• B)A decrease in the rate of inflation
• C)An increase in government purchases
• D)A decision by the Fed to decrease the nominal interest rate
• E)None of these

---

Definitions:

Vertical Axis

In a graph or chart, the vertical line or scale along which numerical data is plotted or measured, usually representing quantities.

Straight Line

A direct, shortest path between two points in a plane, often used in mathematics to describe linear functions.

Horizontal Axis

In a graph or chart, the x-axis, representing the independent variable or the base line for measuring.

Vertical Axis

In a graph or chart, the y-axis which typically represents the dependent variable or outcome in relation to the independent variable on the horizontal axis.