-Suppose the aggregate demand curve in Figure 10.2 increases by a total of $60 billion,from AD₂ to AD_0. Equilibrium GDP will A)Increase by less than $60 billion because some of the additional spending drives up prices. B)Increase by $60 billion. C)Increase by more than $60 billion because of the multiplier effect. D)Decrease because higher inflation causes unemployment.

Question

Quizplus · Accepted Answer

The Answer of -Suppose the aggregate demand curve in Figure 10.2 increases by a total of $60 billion,from AD₂ to AD_0. Equilibrium GDP will A)Increase by less than $60 billion because some of the additional spending drives up prices. B)Increase by $60 billion. C)Increase by more than $60 billion because of the multiplier effect. D)Decrease because higher inflation causes unemployment.

-Suppose the Aggregate Demand Curve in Figure 10