7085lqaines/1 16587/take AD AD Real GDP Based on the figure, wich of the followi

Question

7085lqaines/1 16587/take AD AD Real GDP Based on the figure, wich of the following wculd cause the aggregate demand curve o shift from ADz to ADi O The economy has been producing mu ha ts full-employment output level and wages and input prices begin to risae There is an inerease in the price o oil There is an increase in the general prize level thut reduces real wsalth There is a reduction in co'nurer conhdenre about hrure geowth ir te econom Q G There is a reduczios in income tax rates 00 @ @0e@

Explanation / Answer

THe answer is B-) There is an increase in the price of oil.

Because the components that shift the aggregate demand curve are consumption spending,government spending,investment and net exports. Thus when there is an increase in price of oil, the exports of oil reduced, and in result net exports will aslo reduced and therefore the aggregate demand curve shifts left indicating decreases in aggregate demand. That is shiftment of aggregate demand curve from AD2 to AD1.

Related Questions

Navigate

• Browse (All)
• Browse 7
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.