Consider the Figure Below

question 5

Multiple Choice

Consider the figure below. Which of the following will cause a shift in aggregate demand from AD₂ to AD₁?

• A)An increase in business optimism
• B)An increase in business investment spending
• C)A decrease in interest rates
• D)An increase in interest rates

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Definitions:

Correlation Coefficient

A number that represents the strength and direction of a relationship existing between two variables; number derived from the formula for measuring a correlation.

Psychological Test

A standardized measure designed to assess an individual’s mental and/or behavioral characteristics.

Valid

The quality of being logically or factually sound; applicable more commonly in contexts of arguments or test results.

Standardized

Refers to the process of making something conform to a standard, often used in the context of tests and measures that have uniform procedures and scoring.