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Suppose a Stock Market Crash Decreases the Stock of Household

Question 33

Multiple Choice

Suppose a stock market crash decreases the stock of household wealth and therefore causes autonomous consumption to fall.Which of the following is the likely result?


A) A movement down the AD curve.
B) A movement up the AD curve.
C) A rightward of the shift the AD curve.
D) A leftward shift the AD curve.
E) There will be no movement of the AD curvE.

Correct Answer:

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