Use the Following to Answer Questions

question 91

Multiple Choice

Use the following to answer questions :
Exhibit: IS-LM to Aggregate Demand
-(Exhibit: IS-LM to Aggregate Demand) Based on the graph, if LM₁ shifts to LM₂ because the price level decreases from P₁ to P₂ then, holding other factors constant:

• A) the aggregate demand curve will shift to the right.
• B) the aggregate demand curve will shift to the left.
• C) this represents a movement up the aggregate demand curve.
• D) this represents a movement down the aggregate demand curve.

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