Which of the following is NOT true about the aggregate demand curve?
A) The production possibilities curve determines the slope of the aggregate demand curve.
B) The aggregate demand curve shows total planned real expenditures at different price levels.
C) Changes in the economic conditions in other countries will lead to a shift of the aggregate demand curve.
D) The aggregate demand curve considers the entire circular flow of income.
A
Economics
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Suppose we have an economy in which G = 1100, t = 0.26, Y = 3800, and YN = 4000. At Y the cyclical deficit is
A) 60. B) 112. C) -172. D) -52. E) 52.
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Lump sum taxes _____
a. are difficult to model theoretically but easy to apply b. have a small excess burden c. have no welfare cost d. require perfectly elastic demand curves
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