FIGURE 23-1 Refer to Figure 23-1.Assume the economy is initially in equilibrium with desired aggregate expenditure equal to real GDP at point V.The price level is P₀.Other things being equal,exogenous changes in the price level will cause A)movement along the aggregate expenditure curve AE⁰ and shifts of the AD curve. B)movement along the aggregate expenditure curve AE⁰ and movement along the aggregate demand curve AD⁰. C)shifts of the AE curve and shifts of the AD curve. D)shifts of the AE curve and movement along the aggregate demand curve AD⁰. E)no change in either the AE curve or the AD curve.

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The Answer of FIGURE 23-1 Refer to Figure 23-1.Assume the economy is initially in equilibrium with desired aggregate expenditure equal to real GDP at point V.The price level is P₀.Other things being equal,exogenous changes in the price level will cause A)movement along the aggregate expenditure curve AE⁰ and shifts of the AD curve. B)movement along the aggregate expenditure curve AE⁰ and movement along the aggregate demand curve AD⁰. C)shifts of the AE curve and shifts of the AD curve. D)shifts of the AE curve and movement along the aggregate demand curve AD⁰. E)no change in either the AE curve or the AD curve.