Which of the Following Statements Concerning a Change in Government

question 166

Multiple Choice

Which of the following statements concerning a change in government purchases is true?

• A)The slope of the expenditure line and the magnitude of the AD curve's shift are negatively correlated.
• B)The slope of the expenditure line does not affect the magnitude of the AD curve's shift.
• C)The slope of the expenditure line and the magnitude of the AD curve's shift are positively correlated.
• D)The correlation between the slope of the expenditure line and the magnitude of the AD curve's shift depends negatively on the rate of inflation.
• E)The correlation between the slope of the expenditure line and the magnitude of the AD curve's shift depends positively on the rate of inflation.

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Definitions:

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