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Figure 8-2 A graph shows Real GDP (Q) on the horizontal axis and Price Level (P) on the vertical axis. Two downward-sloping aggregate demand curves,
Figure 8-2 A graph shows Real GDP (Q) on the horizontal axis and Price Level (P) on the vertical axis. Two downward-sloping aggregate demand curves, AD sub 1 and AD sub 2, are plotted on the graph. AD sub 2 lies to the right of AD sub 1. There are four points noted on the graph: ? Point A has coordinates (Q sub 1, P sub 1) ? Point B has coordinates (Q sub 2, P sub 2) ? Point C has coordinates (Q sub 2; P sub 1) ? Point D has coordinates (Q sub 3, P sub 2). Refer to Figure 8-2. A movement from point B to point A on AD1 would have been the result of a. a decrease in the price level. b. an increase in the price level. c. an increase in foreign real national income. d. a decrease in foreign real national income
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