Which of the Following Would Cause the AD Curve to Shift

question 165

Multiple Choice

Which of the following would cause the AD curve to shift to the left?

• A)A decrease in the real rate of interest
• B)A decrease in the rate of inflation
• C)An increase in government purchases
• D)A decision by the Fed to decrease the nominal interest rate
• E)None of these

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Definitions:

Sympathetic Nervous System

Part of the autonomic nervous system that prepares the body for rapid responses to stressors, activating the fight-or-flight response.

Somatic

Relating to or affecting the body, especially as distinct from the mind.

Parasympathetic

The part of the autonomic nervous system that conserves energy by slowing the heart rate and increasing digestive activities.

Gonads

Sex glands; secrete hormones that regulate sexual development and behavior as well as reproduction.