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If the Baseline Level of Autonomous Spending Decreases

Question 28

Multiple Choice

If the baseline level of autonomous spending decreases,


A) the IS curve will shift to the right and the equilibrium levels of the real interest rate and real GDP will increase.
B) the IS curve will shift to the left and the equilibrium levels of the real interest rate and real GDP will decrease.
C) the LM curve will shift to the left and the equilibrium levels of the real interest rate and real GDP will increase
D) the LM curve will shift to the left and the equilibrium levels of the real interest rate and real GDP will increase.

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