In the Short Run,following an Increase in Government Purchases

question 20

Multiple Choice

In the short run,following an increase in government purchases,

• A) the aggregate expenditure line shifts upward by more than the increase in government purchases
• B) real GDP declines by the change in government purchases times the expenditure multiplier
• C) the money supply curve shifts rightward because real income rises
• D) the interest rate rises because the money demand curve shifts rightward
• E) autonomous consumption and investment increase because of the increase in real income

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Definitions:

Contracting Parties

Contracting parties are the individuals or entities who enter into a contract, mutually agreeing to its terms and obligations.

Non-merchants

Individuals or entities that do not engage in commercial trading or business practices as their primary occupation.

Different Terms

Disparate conditions or clauses within an agreement or contract that distinguish from one another.

Unconscionable

A term used to describe actions or conditions that are grossly unfair or ethically wrong, often leading to a contract being declared void.