If the Chinese economy enters a recession,
A) Australia's aggregate demand increases and the AD curve shifts rightward.
B) Australia's aggregate demand decreases and the AD curve shifts leftward.
C) the quantity of real GDP demanded in Australia decreases and there is a movement down along the AD curve.
D) Australia's aggregate demand decreases and the AD curve shifts rightward.
E) the quantity of real GDP demanded in Australia increases and there is a movement up along the AD curve.

Question

Quizplus · Accepted Answer

Australia's economy is significantly tied to China's, especially through trade. If the Chinese economy enters a recession, demand for Australian exports is likely to decrease, leading to a decrease in Australia's aggregate demand and a leftward shift of the AD curve.

If the Chinese Economy Enters a Recession