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Financial Accounting4th EditionDon Herrmann, J. David Spiceland, Wayne Thomas 1,097 solutions What would cause an increase in aggregate demand in the shortAn increase in government purchases boosts aggregate demand from AD1 to AD2. Short-run equilibrium is at the intersection of AD2 and the short-run aggregate supply curve SRAS1. The price level rises to P2 and real GDP rises to Y2. In contrast, a reduction in government purchases would reduce aggregate demand.
Which of the following will cause an increase in aggregate demand?A decrease in taxes, an increase in government spending, or an increase in the money supply will result in an increase in aggregate demand. 9. d. Initially, the shift from c to b equals the decrease in government spending.
Which of the following will cause shortThe correct option is b.
Capital is one of the factors of production and a reduction in the price of capital makes a decline in the production cost of firms. As a result, a decline in the production cost causes the short-run aggregate supply to increase and shift rightwards.
What causes an increase in aggregate demand quizlet?An increase in Total Expenditures will cause an increase in aggregate demand, causing a shift to the right. What causes the aggregate demand curve to shift to the left? A decrease in Total Expenditures will cause a decrease in aggregate demand, causing a shift to the left.
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