Which of the Following Policies Shifts the AD Curve the Farthest

question 173

Multiple Choice

Which of the following policies shifts the AD curve the farthest leftward?

• A) a rise in taxes of $10 billion
• B) a cut in taxes of $10 billion
• C) a decrease in government expenditure of $10 billion
• D) a decrease in both government expenditure and taxes of $10 billion

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Definitions:

Ketones

Organic compounds produced during the breakdown of fats in the body and used as an energy source, especially in the context of low glucose availability.

Glucose

An essential sugar that acts as a vital source of energy for living organisms and is included in multiple carbohydrate compounds.

Nonpathological

Relating to a state that is not indicative of a disease or disorder.

Urobilinogen

A substance formed from the reduction of bilirubin, found in the intestines, and can be excreted in the urine or feces, acting as an indicator of liver function.