gregate demand? gregate demand agregate demand when decrease in transfer payments occurs. when an increase in government expenditures occurs A. decreases; decreases B. decreases; increases C. increases; decreases OD. increases; increases expenditures change me graph shows an aggregate demand curve. uppose there is a decrease in transfer payments. oct of this change on aggregate demand. Label the new curve C, 140 130- 1194 5004 904
gregate demand? gregate demand agregate demand when decrease in transfer payments occurs. when an increase in government expenditures occurs A. decreases; decreases B. decreases; increases C. increases; decreases OD. increases; increases expenditures change me graph shows an aggregate demand curve. uppose there is a decrease in transfer payments. oct of this change on aggregate demand. Label the new curve C, 140 130- 1194 5004 904
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:How do a decrease in transfer payments and an increase in government expenditures change
ggregate demand?
Aggregate demand
Aggregate demand
when decrease in transfer payments occurs.
when an increase in government expenditures occurs.
A. decreases; decreases
OB. decreases; increases
OC. increases; decreases
OD. increases; increases
The graph shows an aggregate demand curve.
Suppose there is a decrease in transfer payments.
Draw a new curve to show the effect of this change on aggregate demand. Label the new curve C,
Now suppose that there is an increase in government expenditures.
Price level (GDP otator, 2007-100)
130
120
1104
100+
00
804
10
AD
18
JOO
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