-Refer to Exhibit 10-7

question 12

Multiple Choice

-Refer to Exhibit 10-7.If autonomous consumption increases,which of the following is possible?

• A) The AD curve will shift rightward from AD₁ to AD₂,the price level will remain constant,and Real GDP will rise.
• B) The AD curve will shift leftward from AD₄ to AD₃,the price level will fall,and Real GDP will remain constant.
• C) The AD curve will shift rightward from AD₃ to AD₄,the price level will remain constant,and Real GDP will rise.
• D) The AD curve will shift rightward from AD₁ to AD_2, the price level will rise,and Real GDP will remain constant.

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Definitions:

Total Cash Flow

The complete sum of cash flowing in and out of a company, particularly influencing its ability to meet short-term obligations.

Operating Cash Flow

The financial output derived from a company's core business practices.

Capital Spending

Expenditures by a company for physical assets such as property, industrial buildings, or equipment, intended to improve its long-term capacity or efficiency.

Salvage Value

An asset's expected market price at the conclusion of its effective life.