Figure 9.1 Alt text for Figure 9.1: In figure 9.1, a graph comparing real GDP and price level.
Long description for Figure 9.1: The x-axis is labelled, real GDP, and the y-axis is labelled, price level, with 0 at the vertex.Line AD1 begins in the top left corner and slopes down to the bottom center.Line AD2 follows the same slope as line AD1 but is plotted to the right.Points A and B are plotted along line AD1.Point A is a little less than half way along the left side of the line, and point B is little more than half way on the right side of the line.
-Refer to Figure 9.1.Ceteris paribus, an increase in interest rates would be represented by a movement from

Question

Figure 9.1

Alt text for Figure 9.1: In figure 9.1, a graph comparing real GDP and price level.
Long description for Figure 9.1: The x-axis is labelled, real GDP, and the y-axis is labelled, price level, with 0 at the vertex.Line AD1 begins in the top left corner and slopes down to the bottom center.Line AD2 follows the same slope as line AD1 but is plotted to the right.Points A and B are plotted along line AD1.Point A is a little less than half way along the left side of the line, and point B is little more than half way on the right side of the line.
-Refer to Figure 9.1.Ceteris paribus, an increase in interest rates would be represented by a movement from

Quizplus · Accepted Answer

An increase in interest rates would lead to a decrease in consumer spending and investment, resulting in a leftward shift of the AD curve. This movement would be represented by a shift from AD₂ to AD₁, with point B shifting towards point A. Therefore, the correct choice is B.

Figure 91 Alt Text for Figure 9