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.Now,suppose the AE curve shifts to AE1 and we move to a new equilibrium level of GDP at Y1 and point A on AD0.A possible cause of this change in equilibrium is
A)an exogenous rise in the price level.
B)a decrease in desired investment.
C)a decrease in autonomous consumption.
D)a decrease in desired net exports.
E)an increase in government purchases.

Question

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.Now,suppose the AE curve shifts to AE1 and we move to a new equilibrium level of GDP at Y1 and point A on AD0.A possible cause of this change in equilibrium is
A)an exogenous rise in the price level. 
B)a decrease in desired investment. 
C)a decrease in autonomous consumption. 
D)a decrease in desired net exports. 
E)an increase in government purchases.

Quizplus · Accepted Answer

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.Now,suppose the AE curve shifts to AE1 and we move to a new equilibrium level of GDP at Y1 and point A on AD0.A possible cause of this change in equilibrium is
A)an exogenous rise in the price level. 
B)a decrease in desired investment. 
C)a decrease in autonomous consumption. 
D)a decrease in desired net exports. 
E)an increase in government purchases.

FIGURE 23-1 -Refer to Figure 23-1.Assume the Economy Is Initially in Equilibrium