Solved: Which of the following government policies will shift the aggregate demand curve

Chapter 0, Problem 5

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QUESTION:

Which of the following government policies will shift the aggregate demand curve to the left? a. a decrease in the quantity of money b. an increase in government purchases of goods and services c. a decrease in taxes d. a decrease in interest rates e. an increase in government transfers

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QUESTION:

Which of the following government policies will shift the aggregate demand curve to the left? a. a decrease in the quantity of money b. an increase in government purchases of goods and services c. a decrease in taxes d. a decrease in interest rates e. an increase in government transfers

ANSWER:

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The shift in the demand curve occurs only in a period of contractionary fiscal policy or economic phenomena which will slow down the economy.

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