If Europe Has a Large Increase in Income, What Will

question 60

Multiple Choice

If Europe has a large increase in income, what will happen in the United States?

• A) The aggregate demand curve will shift to the right.
• B) The aggregate demand curve will shift to the left.
• C) The aggregate demand curve will not change.
• D) The aggregate demand curve will shift to the left in the short run and then to the right in the long run.

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Definitions:

Inequality

A mathematical statement that compares two expressions using symbols to indicate that one is larger, smaller, or different from the other.

Compounded Annually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods, applied once per year.

Interest Rate

The rate at which interest is applied to a borrowed sum, usually shown as an annual percentage of the remaining loan amount.

Perimeter

The perimeter of a shape is the total length of its boundary, measured along the outer sides.