-In the above figure, a movement from point B to point C could be explained by
A) an increase in the price level.
B) a decrease in the quantity of money in circulation.
C) increased government spending.
D) the real-balance effect.

Question

-In the above figure, a movement from point B to point C could be explained by
A) an increase in the price level. 
B) a decrease in the quantity of money in circulation. 
C) increased government spending. 
D) the real-balance effect.

Quizplus · Accepted Answer

Increased government spending can shift the aggregate demand curve to the right, moving the economy from point B to point C, indicating higher overall demand in the economy.

-In the Above Figure, a Movement from Point B to Point