QUESTION 8expenditures, income12011010028888888QUESTION 99080706050403020100▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬08. Which of the following could have caused a shift of the Aggregate Expenditures curve from AE1 to AE2?O (a) an increase in the price level(b) an increase in the rate of interestO (c) an improvement in consumer confidenceO (d) a contractionary monetary policy0 10 20 30 40 50 60 70 80 90 100 110 120income: Q2006 NATIONAL INCOME DATA (billions of dollars)Personal consumption expendituresGross private domestic investmentExportsImports9277.22701.01470.22256.6Government consumption expenditures and gross investmentCapital consumption allowances (depreciation)953.3Survey of Current Business, National Income and Product Accounts, Tables 1.1.5 & 7.1309. The Net Domestic Product is:O(a) 19282.1O (b) 17025.5O (c) 16072.2(d) 13815.6O(e) 12862.3AE2AE 12623.8

The correct answer is (c), an improvement in consumer confidence.Consumer spending increases when…

08. Which of the following could have caused a shift of the Aggregate Expenditures curve from AE1 to AE2? O(a) an increase in the price level (b) an increase in the rate of interest (c) an improvement in consumer confidence (d) a contractionary monetary policy

08. Which of the following could have caused a shift of the Aggregate Expenditures curve from AE1 to AE2? O(a) an increase in the price level (b) an increase in the rate of interest (c) an improvement in consumer confidence (d) a contractionary monetary policy

Macroeconomics: Principles and Policy (MindTap Course List)

13th Edition

ISBN:9781305280601

Author:William J. Baumol, Alan S. Blinder

Publisher:William J. Baumol, Alan S. Blinder

Chapter8: Aggregate Demand And The Powerful Consumer

Section: Chapter Questions

Problem 8DQ

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