Which of the following statements concerning a change in government purchases is true?
A) The slope of the expenditure line and the magnitude of the AD curve's shift are negatively correlated.
B) The slope of the expenditure line does not affect the magnitude of the AD curve's shift.
C) The slope of the expenditure line and the magnitude of the AD curve's shift are positively correlated.
D) The correlation between the slope of the expenditure line and the magnitude of the AD curve's shift depends negatively on the rate of inflation.
E) The correlation between the slope of the expenditure line and the magnitude of the AD curve's shift depends positively on the rate of inflation.
Correct Answer:
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Q105: The AD curve slopes down because there
Q106: If, for any given rate of inflation,
Q107: Exhibit 24-3 Q108: An increase in the target inflation rate Q109: The AD curve slopes upward because interest Q111: If the central bank increases the target Q112: Exhibit 24-4 Q113: If business confidence increases, Q114: Exhibit 24-4 Q115: An increase in imports will Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents
A)there will be an
A)cause a downward
