None If autonomous expenditure increases with no change in the price level, what happens to the AE curve and theAD curve?Which curve shifts by an amount that is determined by the multiplier and why?TheThebecause thecurve shifts upward by an amount equal to the increase in autonomous expenditure.curve shifts nightward by an amount equal to the increase in autonomous expenditure times the multiplierat each price level.OA. AD, AE, AE curve plots aggregate planned expenditureOB. AD, AE, AE curve plots equilibrium expenditureO C. AE, AD, AD curve plots aggregate planned expenditureOD. AE, AD, AD curve plots equilibrium expenditureThe graph shows the aggregate demand curveInvestment increases by $0.5 trillion, and the multiplier is 4.Draw a new aggregate demand curve that shows the effect of the increase in investment Label it AD,Draw a point to indicate the quantity of real GDP demanded following the increase in investment when the price level is115. Label it BPrice level (GDP deflator, 2012-100)165-Qa1451251151058514AD658101214161820Real GDP (trillions of 2012 dollars)>>> Draw only the objects specified in the question.

Draw a new aggregate demand curve that shows the effect of the increase in investment. Label it…

Answered: If autonomous expenditure increases…

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter11: Managing Aggregate Demand: Fiscal Policy

Section: Chapter Questions

Problem 2TY

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