FIGURE 23-1 Refer to Figure 23-1

Multiple Choice

FIGURE 23-1 Refer to Figure 23-1.Assume the economy is initially in equilibrium with desired aggregate expenditure equal to real GDP at point V.The price level is P₀.Now,suppose the AE curve shifts to AE² and we move to a new equilibrium level of GDP at Y₂ and point E on AD².A possible cause of this change in equilibrium is

A) an increase in government purchases.
B) an increase in the net tax rate.
C) a decrease in desired investment.
D) a decrease in desired net exports.
E) an exogenous fall in the price level.