(Figure: Predicting Aggregate Demand Shifts) Which of These Would Shift

question 281

Multiple Choice

(Figure: Predicting Aggregate Demand Shifts) Which of these would shift the aggregate demand curve from AD₁ to AD₂?

• A) an increase in taxes
• B) a decrease in interest rates
• C) a decrease in government purchases
• D) a worsening of consumer expectations about the future

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Definitions:

Functional Residual Capacity (FRC)

The amount of air left in the lungs following a standard breath out.

Residual Volume (RV)

The volume of air remaining in the lungs after a maximal exhalation, important for keeping the lungs inflated.

Obstructive Lung Diseases

A category of respiratory conditions that involve blockages or narrowing of the airways, leading to difficulty breathing, e.g., asthma, COPD.

Chronic Bronchitis

A long-term inflammation of the bronchi in the lungs, often characterized by coughing and breathing difficulties.