For a given level of inflation, if a resolution of international disputes leads to a cutback in government military spending, then the ________ shifts ________.
A)aggregate demand curve; right
B)short-run aggregate supply line; downward
C)aggregate demand curve; left
D)short-run aggregate supply line; upward

Question

Quizplus · Accepted Answer

A sudden decrease in government (military)spending will reduce aggregate spending and shift the AD curve to the left.

For a Given Level of Inflation, If a Resolution of International