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Exhibit 15-6 Aggregate Demand and Supply Model

Question 160

Multiple Choice

Exhibit 15-6 Aggregate demand and supply model

-In Exhibit 15-6,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 taxes to move to AD₃.
D) cut spending to move to AD₃..
E) not change its policy.

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