This question involves algebraically solving the system of two equations given by the AD and AS curves. The equations for the curves are given by the following: AD: YAD = 720 - 25P + 56 where Y is real GDP, P is the price level, As: YAs = 8 + 6P - 4Poil G is the level of government purchases = $350, and P0" is the world price of oil = $40. AD: YAD = 720 25p + (5 x 350) AS: YAS=8+ 6P (4x40) a. Which of the following is true regarding the various terms in the AD curve? (Assume that AD is measured on the vertical axis and price is measured on the horizontal axis.) A. The term 2,470 represents the x-intercept, -25 represents the simple multiplier, and 5 represents the change in real GDP that would occur when government spending changed by one dollar if the aggregate supply curve was vertical. B. The term 720 represents the y-intercept, - 25 represents the slope, and 5 represents the change in real GDP that would occur when government spending changed by one dollar if the aggregate supply curve was vertical. C. The term 720 represents the x-intercept, - 25 represents the slope, and 5 represents the change in real GDP that would occur when any spending changed by one dollar if the aggregate supply curve was horizontal. 3 D. The term 2,470 represents the y-intercept, - 25 represents the slope, and 5 represents the change in real GDP that would occur when government spending changed by one dollar if the aggregate supply curve was horizontal. G enters posit'wely because a rise in government purchases, other things equal, leads to a higher level of aggregate demand. b. The value of the simple multiplier is . (Round your response to the nearest whole value.)