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Which Statement Best Describes the Relationship Among the Three Effects

Question 27

Multiple Choice

Which statement best describes the relationship among the three effects that influence the slope of the aggregate demand curve?


A) The real wealth effect always precedes the other two.
B) If the real exchange is large then the other two effects will be minimal.
C) All three effects occur simultaneously.
D) If the real interest occurs first then the other two effects will be relatively large.

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