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Exhibit 11-6 Aggregate Demand and Supply Model in Exhibit

Question 179

Multiple Choice

Exhibit 11-6 Aggregate demand and supply model Exhibit 11-6 Aggregate demand and supply model In Exhibit 11-6, if the aggregate demand curve is at AD<sub>2</sub>, the government should: A) raise taxes to move to AD<sub>1</sub>. B) cut taxes to move to AD<sub>3</sub>. C) cut spending to move to AD<sub>3</sub>. D) not change its policy. In Exhibit 11-6, if the aggregate demand curve is at AD2, the government should:


A) raise taxes to move to AD1.
B) cut taxes to move to AD3.
C) cut spending to move to AD3.
D) not change its policy.

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