An Aggregate Demand Curve Can Be Drawn By

question 51

Multiple Choice

An aggregate demand curve can be drawn by:

• A)shifting the 45-degree line.
• B)letting changes in autonomous spending shift the aggregate expenditure line.
• C)letting changes in the price level shift the aggregate expenditure line.
• D)letting changes in the level of income shift the aggregate expenditure line.
• E)letting changes in real GDP shift the aggregate expenditure line.

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Definitions:

Fiscal Policy

Government policies related to taxation and spending that are used to influence a country's economic conditions.

Private Spending

Expenditures made by individuals, households, and businesses in the private sector, excluding government spending.

Monetary Policy

Economic strategies and decisions made by a central bank or government agency regarding the supply of money and levels of interest rates in an economy.

Fiscal Policy

Governmental policies concerning taxing and spending that are intended to influence economic conditions, including aggregate demand, inflation, and unemployment.