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    Foundations of Macroeconomics Study Set 2
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    Exam 13: Aggregate Supply Ad Aggregate Demand
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    When the Price Level Falls
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When the Price Level Falls

Question 2

Question 2

Multiple Choice

When the price level falls,


A) there is a movement downward along the AS curve.
B) both the potential GDP line and the AS curve shift leftward.
C) there is a movement upward along the AS curve.
D) the AS curve shifts rightward but the potential GDP line does not shift.
E) the AS curve shifts leftward but the potential GDP line does not shift.

Correct Answer:

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