-In the above figure, the shift from AE₀ to AE₁ might have been caused by A) an increase in government expenditures. B) an increase in the real interest rate. C) an increase in the price level. D) All of the above answers are correct.

Question

Quizplus · Accepted Answer

An increase in government expenditures can shift the aggregate expenditure curve from AE₀ to AE₁ by increasing overall demand in the economy.

-In the Above Figure, the Shift from AE0 to AE1

-In the Above Figure, the Shift from AE₀ to AE₁