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October 22, 2014

Homework Help: Economics

Posted by Codey on Tuesday, May 31, 2011 at 1:19pm.

Concern about international crisis has caused consumers to save their money and postpone big purchases. What is the effect on aggregate demand and aggregate supply?
A. No change
B. Aggregate supply will decrease, raising the price level and lowering real GDP
C. Aggregate demand will increase, lowering both real GDP and the price level
D. Both aggregate demand and aggregate supply will decrease, leading to lower real GDP

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