A movement along an aggregate demand curve corresponds to a change in income in the IS-LM model ______, while a shift in an aggregate demand curve corresponds to a change in income in the IS-LM model ______.
A) resulting from a change in monetary policy; resulting from a change in fiscal policy
B) resulting from a change in fiscal policy; resulting from a change in monetary policy
C) at a given price level; resulting from a change in the price level
D) resulting from a change in the price level; at a given price level

Question

Quizplus · Accepted Answer

A movement along the aggregate demand curve is due to a change in the price level, while a shift in the aggregate demand curve occurs at a given price level due to factors like fiscal or monetary policy changes.

A Movement Along an Aggregate Demand Curve Corresponds to a Change