An increase in consumption, combined wiht an increase in exports, would have what effect on aggregate...
An increase in consumption, combined wiht an increase in exports, would have what effect on aggregate demand? a. AD would increase b. AD would decrease c. AD would stay the same
d. AD could either increase or decrease, depending on which change was of greater magnitude
Which of the following helps explain the downward slope of the aggregate demand curve? a. the real wealth effect b. the interest rate effect c. the open economy effect d. all of the above e. none of the above
Homework Answers
Ans: a) AD would increase
Explanation:
An increase in consumption and exports lead increase in aggregate demand. As a result the aggregate demand curve will shift to the right.
Ans: d) all of the above
Explanation:
The causes for downward slope of the aggregate demand curve are the real wealth effect , the interest rate effect and the open economy effect or net export effect.
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