Figure 9.2

-Refer to Figure 9.2. A movement from point a to point d could be caused by a simultaneous ________ and ________.
A) increase in government spending; decrease in the price of oil
B) increase in taxes; increase in the price of oil
C) decrease in taxes; massive crop failure
D) decrease in the money supply; decrease in government spending

Question

Figure 9.2
 
-Refer to Figure 9.2. A movement from point a to point d could be caused by a simultaneous ________ and ________.
A) increase in government spending; decrease in the price of oil 
B) increase in taxes; increase in the price of oil 
C) decrease in taxes; massive crop failure 
D) decrease in the money supply; decrease in government spending

Quizplus · Accepted Answer

A movement from point a to point d in a typical macroeconomic model, such as the Aggregate Demand and Supply model, would indicate a decrease in aggregate demand. This could be caused by an increase in government spending (which boosts aggregate demand) and a decrease in the price of oil (which can reduce costs for businesses and increase disposable income for consumers, thereby further increasing aggregate demand).

Figure 9.2 -Refer to Figure 9.2. a Movement from Point a to from Point