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Exhibit 15-6  Aggregate Demand and Supply Model in Exhibit 15-6

Question 157

Multiple Choice

Exhibit 15-6  Aggregate demand and supply model Exhibit 15-6  Aggregate demand and supply model In Exhibit 15-6, if the aggregate demand curve is at AD<sub>1</sub> , the government should: A) raise taxes to move to AD<sub>2</sub>. B) cut taxes to move to AD<sub>2</sub>. C) cut taxes to move to AD<sub>3</sub>. D) cut spending to move to AD<sub>2</sub>. E) not change its behavior. In Exhibit 15-6, if the aggregate demand curve is at AD1 , the government should:


A) raise taxes to move to AD2.
B) cut taxes to move to AD2.
C) cut taxes to move to AD3.
D) cut spending to move to AD2.
E) not change its behavior.

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