When drawn against the real interest rate, the output demand curve unambiguously shifts to the right if either or both of the following occur
A) an increase in current taxes and an increase in future taxes
B) an increase in current taxes and a decrease in future taxes
C) a decrease in current taxes and an increase in future taxes
D) a decrease in current taxes and a decrease in future taxes
D
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If deviations from trend in a macroeconomic variable are negatively correlated with deviations from trend in real GDP, that variable is said to be
A) useless in predicting future movements in real GDP. B) procyclical. C) countercyclical. D) acyclical.
The net exports effect exists because a:
a. higher price level will reduce interest rates and stimulate foreign investment. b. lower price level will make domestically produced exports less expensive relative to foreign goods. c. higher price level will reduce the purchasing power of money. d. lower price level will encourage Americans to import more foreign goods.