A Change in Government Purchases Shifts the Aggregate Demand Curve

question 104

Multiple Choice

A change in government purchases shifts the aggregate demand curve by an amount equal to the

• A) change in consumption * marginal propensity to consume.
• B) change in government purchases * money multiplier.
• C) change in government purchases *spending multiplier.
• D) change in the spending multiplier * change in government purchases.

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Definitions:

Light Waves

Electromagnetic waves that are visible to the human eye, responsible for the phenomenon of sight.

Violet

A color at the end of the visible spectrum of light, next to blue and opposite of red.

Blue

A primary color perceived when light with a dominant wavelength between approximately 450 and 495 nanometers is detected by the eye.

Sensory Responsiveness

The degree to which an individual reacts to or perceives sensory stimuli from the environment.