Figure 13.1 -Refer to Figure 13.1.All else equal,a decrease in government purchases would best be represented by a movement from A) point A to point B. B) point B to point A. C) point B to point C. D) point C to point B.

Question

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A decrease in government purchases would shift the aggregate demand curve to the left, which would lead to a decrease in output and a decrease in the price level. This is represented by a movement from point B to point A.

Figure 13.1 -Refer to Figure 13.1.All Else Equal,a Decrease in Government Purchases