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Suppose an Economy Existed in Which Investment, Net Exports, and Consumption

Question 64

Multiple Choice

Suppose an economy existed in which investment, net exports, and consumption were not sensitive to changes in interest rates. For this economy, the AD curve would


A) have a slope less than 1 but greater than zero.
B) be horizontal.
C) have a negative slope.
D) be vertical.
E) have a slope equal to 1.

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