The Pigou Effect Is

question 98

Multiple Choice

The Pigou effect is

• A)the stimulus to aggregate demand from a fall in the interest rate.
• B)the effect of a cut in taxes on the aggregate demand curve.
• C)the effect of a fall in prices on aggregate demand curve.
• D)the direct stimulus to consumption because of an increase in the real value of the money supply.

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Definitions:

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