A demand shock is a change in planned spending that is:
A) caused by changes in output.
B) caused by changes in the inflation rate.
C) caused by changes in output and changes in the real interest rate.
D) not caused by changes in output or changes in the inflation rate.
Correct Answer:
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Q12: When the inflation rate decreases, PAE _,
Q13: If the interest rate in the U.S.rises,
Q14: If the interest rate in the U.S.falls,
Q15: Changes in planned spending that shift the
Q16: Shifts in _ can return the economy
Q18: When the inflation rate increases, PAE _,
Q19: The AD curve slopes downward because an
Q20: When the interest rate in the U.S.rises,
Q21: Due to menu costs, many firms in
Q22: Firms that face menu costs react to
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