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Refer to Figure 2 Below

Question 16

Multiple Choice

Refer to Figure 2 below.Which of the following statements is NOT true? Figure 2
Refer to Figure 2 below.Which of the following statements is NOT true? Figure 2   A) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in interest rates. B) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from an increase in exports. C) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in saving. D) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in government expenditure.


A) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in interest rates.
B) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from an increase in exports.
C) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in saving.
D) The upward shift in the expenditure line from C+I+G+(X-M) 1 to C+I+G+(X‑M) ₂ and consequent increase in national income would result from a reduction in government expenditure.

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