Figure 9.1 -Refer to Figure 9.1. When the price level drops and causes a higher net exports, it is illustrated as: A) an aggregate demand curve shift from AD₁to AD₀. B) an aggregate demand curve shift from AD₁to AD₂. C) a move from Point A to Point B, but not a shift of the aggregate demand curve. D) a move from Point B to Point A, but not shift of the aggregate demand curve.

Question

Quizplus · Accepted Answer

A drop in the price level leading to higher net exports results in a movement along the aggregate demand curve, not a shift.

Figure 9.1 -Refer to Figure 9.1. When the Price Level Drops and Drops