Which of the following events shifts the aggregate expenditure curve and also shifts the aggregate demand curve?
I. a decrease in investment
II. a change in the price level
III. an increase in exports
A)I and II
B)I and III
C)II and III
D)I, II, and III
E)all of the above

Question

Quizplus · Accepted Answer

I. a decrease in investment: This will shift the aggregate expenditure curve to the left but it won't affect the aggregate demand curve. 
II. a change in the price level: This will shift both the aggregate expenditure curve (along the same curve) and the aggregate demand curve (moving along the curve). 
III. an increase in exports: This will shift both the aggregate expenditure curve (upwards) and the aggregate demand curve (to the right). Therefore, only option B is correct as it includes both events that shift both curves.

Which of the Following Events Shifts the Aggregate Expenditure Curve